American Economic Review Vol. 101 No. 1 2011
Trade Liberalization, Exports, and Technology Upgrading: Evidence on the Impact of MERCOSUR on Argentinian Firms
open access
Abstract
This paper studies the impact of a regional free trade agreement, MERCOSUR, on technology upgrading by Argentinean firms. To guide empirical work, I introduce technology choice in a model of trade with heterogeneous firms. The joint treatment of the technology and exporting choices shows that the increase in revenues produced by trade integration can induce exporters to upgrade technology. An empirical test of the model reveals that firms in industries facing higher reductions in Brazil's tariffs increase investment in technology faster. The effect of tariffs is highest in the upper-middle range of the firm-size distribution, as predicted by the model.
- DOI
- 10.1257/aer.101.1.304
- Volume
- 101
- Issue
- 1
- Pages
- 304-340
- Language
- en
- Sources
- openalex crossref bibtex:phds-export.bib