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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/30616
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| Title: | | Intra-industry adjustment to import competition : theory and application to the German clothing industry  |
| Authors: | | Raff, Horst Wagner, Joachim |
| Issue Date: | | 2009 |
| Series/Report no.: | | CESifo working paper 2851 |
| Abstract: | | This paper uses an oligopoly model with heterogeneous firms to examine how an industry adjusts to rising import competition. The model predicts that in the short run the least efficient firms in the industry become inactive, surviving firms face a fall in output, mark-ups and profits, and the average productivity of survivors increases. These pro-competitive effects of import penetration on the domestic industry disappear in the long run. The predictions for the short run are confirmed in an empirical study of the German clothing industry. |
| Subjects: | | international trade firm heterogeneity productivity clothing industry |
| JEL: | | F12 F15 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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