Multi-product Firms, Tariff Liberalization, and Product Churning in Vietnamese Manufacturing

Multi-Product Firms and Trade Liberalization∗

This paper develops a general equilibrium model of international trade that features selection across firms, products and countries. Firms’export decisions depend on a combination of firm “productivity” and firm-product-country “consumer tastes”, both of which are stochastic and unknown prior to the payment of a sunk cost of entry. Trade liberalization induces endogenous reallocations of resour...

No 769 December 2006 Multi - Product Firms and Trade Liberalization

This paper develops a general equilibrium model of multi-product firms and analyzes their behavior during trade liberalization. Firm productivity in a given product is modeled as a combination of firm-level “ability” and firmproduct-level “expertise”, both of which are stochastic and unknown prior to the firm’s payment of a sunk cost of entry. Higher firm-level ability raises a firm’s productiv...

Web-Based Technical Appendix: Multi-Product Firms and Trade Liberalization

This appendix contains additional technical derivations and supplementary material for the main paper. Section 1 presents model solutions for the special case where firm productivity and consumer tastes are Pareto distributed. Section 2 contains the complete proof of Proposition 3 in the paper. Section 3 shows that it is straightforward to extend the model to introduce dependence in consumer ta...

Technical Appendix: Multi-Product Firms and Trade Liberalization (Not For Publication)

Spillovers in Product and Process Innovation : Evidence from Manufacturing Firms

This paper proposes a new empirical approach to assess the impact of knowledge spillovers on firms' productivity and demand. I consider a model where process innovations spillovers to other firms raise firms relative efficiency and technological diffusion of product innovations enhances firms' demand. By modelling knowledge capital as a function of own investment in R\&D and spillovers, I can c...