Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/234676 
Year of Publication: 
2019
Series/Report no.: 
IDB Working Paper Series No. IDB-WP-01087
Publisher: 
Inter-American Development Bank (IDB), Washington, DC
Abstract: 
We study the impact of import competition on Mexican firm outcomes between 2003 and 2013 by exploiting variation in import penetration across industries. Focusing on the increase in import competition from China that Mexico experienced during this period, we find that the trade shock induced a decline in employment, sales, exports, and productivity. Importantly, the results show that the average impact hides significant heterogeneity effects, with smaller and less efficient plants experiencing the largest adjustments, while the most efficient plants exhibited relatively minor effects and, for some outcomes, no effects at all. The existence of heterogeneous impacts across establishments is consistent with other sets of findingsfor instance, that the productivity gap between small and large plants has been increasing over time and that the reallocation of resources has been productivity-enhancing, particularly in sectors that have experienced large-scale import penetration from China.
Subjects: 
import competition
manufacturing plants
productivity
JEL: 
F14
F61
L25
L60
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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