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Unpublished Paper
Imports and TFP at the Firm Level: The Role of Absorptive Capacity
  • Olivier Cadot, University of Lausanne
  • Patricia Augier
  • Marion Dovis
This paper estimates the effect of the decision to import intermediate goods and capital equipment on Total Factor Productivity (TFP) at the firm level on a panel of Spanish firms (1991-2002). We use two alternative approaches. In the first, we estimate TFP and apply a diff-in-diff estimator with a control group constructed by propensity-score matching. In the second, direct method, we estimate TFP with imported inputs as a state variable in one stage. Both approaches show that the effect of a firm’s decision to source intermediates and capital equipment abroad on its TFP depends critically on its capacity to absorb technology, measured by the proportion of skilled labor.
  • Productivity,
  • TFP,
  • imports,
  • Olley-Pakes,
  • Ackerberg-Caves-Frazer,
  • absorptive capacity
Publication Date
Citation Information
Olivier Cadot, Patricia Augier and Marion Dovis. "Imports and TFP at the Firm Level: The Role of Absorptive Capacity" (2011)
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