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- W3122272918 abstract "This paper presents theory and evidence from Chinese firm-product data that, given firm productivity, trade liberalization increases product markups. This finding calls for a reconsideration of the well-established imports-as-market-discipline hypothesis. This paper further verifies underlying mechanisms behind this finding: input tariff reductions decrease marginal costs, and tariff effects on markup adjustments are more profound among firms of higher import dependence. By comparing results for two trade regimes -- ordinary trade wherein firms pay import tariffs to import, and processing trade wherein firms are not subject to import tariffs -- this paper finds that the aforementioned effects only apply to ordinary trade." @default.
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- W3122272918 date "2015-01-01" @default.
- W3122272918 modified "2023-10-01" @default.
- W3122272918 title "Input-Trade Liberalization and Markups" @default.
- W3122272918 doi "https://doi.org/10.2139/ssrn.2607794" @default.
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