On the Role of Imports in Enhancing Manufacturing Exports

Daniela Maggioni, Alessia Lo Turco

Research output: Contribution to journalArticlepeer-review

24 Citations (Scopus)

Abstract

Making use of a large panel data set on Italian manufacturing firms, we provide evidence on the effect of imports on the firm's export performance. We distinguish imports of intermediates according to their origin, and we find that inputs sourced from low labour cost countries promote the firm's export activity. Imports from high-income countries do not significantly contribute to the export orientation of firms, especially when both persistence in export and the possible endogeneity of the import measures are accounted for via system generalised method of moments (GMM) estimation of a linear probability model. Our evidence suggests that the impact of imports on the firms' export activity works through the cost-saving channel rather than the technology channel. © 2012 Blackwell Publishing Ltd.
Original languageEnglish
Pages (from-to)93-120
Number of pages28
JournalWorld Economy
Volume36
DOIs
Publication statusPublished - 2013

Keywords

  • trade
  • labour costs
  • low income countries

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