International College of Economics and Finance

Research Seminar by Amanda Jakobsson (Singapore Management University)

On Thursday, November 27 at 4.40 pm, room 3211 (Shabolovka str. 26) ICEF held the Research Seminar.
Speaker: Amanda Jakobsson (Singapore Management University)
Theme: "Export-Learning and FDI with Heterogeneous Firms"

On Thursday, November 27 at 4.40 pm International College of Economics and Finance held the Research Seminar.

Speaker: Amanda Jakobsson (Singapore Management University)
Theme: "Export-Learning and FDI with Heterogeneous Firms"
Venue: Shabolovka st., 26, room 3211

Abstract: I present a dynamic general equilibrium model with heterogeneous firms that can innovate, learn how to export and then go on to become multinational firms. Entering the foreign market is a dynamic process where firms first learn how to export and then can learn how to adapt production to a low-wage location (multinational production). I solve the model numerically and, starting from a 1990 benchmark of US and Mexico, study how policy changes such as stronger patent protection and trade liberalization affect innovation, technology transfer and consumer welfare. In particular, I disentangle how labor resources are reallocated within regions in response to policy changes: across sectors (production, innovation, export-learning and adaption to multinational production), across high-productivity and low-productivity firms, and within firms as they produce more (less) for the home market visavi the export market. I obtain higher rates of export-learning and FDI for high-productivity firms than for low-productivity firms. As a result, exporters are on average more productive than non-exporters, and multinational firms are on average more productive than exporters. In equilibrium, there are still some low-productivity exporters, some low-productivity multinational firms and some high-productivity non-exporters. Low-productivity firms export and engage in FDI but they are just not as successful in these activities as high-productivity firms.


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