Center for Economic Studies and ifo Institute (CESifo), Munich
This paper studies the impact of trade reforms on the evolution of plant's productivity in Chile (1979-2000). The main contribution of the paper is to construct detailed measures of trade liberalization disentangling the impact of export and import oriented policies. We find evidence of a positive impact of export oriented policies on productivity of traded sectors relative to non traded. On the other hand, the reduction of import barriers might have a positive impact on productivity in export oriented sectors, but it hurts local firms in import competing ones probably due to the existence of increasing returns.