scholarly journals Inventory Management, Product Quality, and Cross‑Country Income Differences

2019 ◽  
Vol 11 (1) ◽  
pp. 338-388 ◽  
Author(s):  
Bernardo S. Blum ◽  
Sebastian Claro ◽  
Kunal Dasgupta ◽  
Ignatius J. Horstmann
Keyword(s):  
Product Quality ◽  
Inventory Management ◽  
Reduced Form ◽  
Poor Countries ◽  
Quality Upgrading ◽  
Country Differences ◽  
Cross Country ◽  
Export Destination ◽  
The One ◽  
Rich Countries

Previous research has documented that export shipments are “lumpy”— exporters make infrequent and relatively large shipments to any given export destination. This fact has been interpreted as implying that fixed, per shipment cost and inventory management decisions play a key role in international trade. We document here that exports from poor countries are considerably more lumpy—have higher fixed per shipment cost— than those from rich countries. Using a model of trade with inventory management, we estimate that the country at the ninetieth percentile of the distribution of per shipment costs has almost three times higher costs than the one at the tenth percentile. We show that these per shipment cost differences have a reduced-form representation given by an ad  valorem trade cost that varies with export country income (as in Waugh 2010 ). A calibrated version of the model that incorporates these estimates and allows for endogenous product quality reveals that cross-country differences in per shipment costs explain almost 40 percent of the observed cross-country differences in income. It also shows that policies that lower per shipment costs can lead to significant welfare gains, mainly due to induced quality upgrading. (JEL F12, F14, F43, G31, O16, O19)

scholarly journals If Technology Has Arrived Everywhere, Why Has Income Diverged?

2018 ◽  
Vol 10 (3) ◽  
pp. 137-178 ◽  
Author(s):  
Diego Comin ◽  
Martí Mestieri
Keyword(s):  
Technology Diffusion ◽  
Aggregate Productivity ◽  
Poor Countries ◽  
Income Divergence ◽  
Evolution Of Technology ◽  
World Income ◽  
World Income Distribution ◽  
Cross Country ◽  
The Cross ◽  
Rich Countries

We study the cross-country evolution of technology diffusion over the last two centuries. We document that adoption lags between poor and rich countries have converged, while the intensity of use of adopted technologies of poor countries relative to rich countries has diverged. The evolution of aggregate productivity implied by these trends in technology diffusion resembles the actual evolution of the world income distribution in the last two centuries. Cross-country differences in adoption lags account for a significant part of the cross-country income divergence in the nineteenth century. The divergence in intensity of use accounts for the divergence during the twentieth century. (JEL N10, N70, O14, O33, O41, O47)

scholarly journals The World Technology Frontier

2006 ◽  
Vol 96 (3) ◽  
pp. 499-522 ◽  
Author(s):  
Francesco Caselli ◽  
Wilbur John Coleman
Keyword(s):  
Skilled Labor ◽  
Simple Explanation ◽  
Unskilled Labor ◽  
Skilled Workers ◽  
Poor Countries ◽  
Aggregate Production Function ◽  
Unskilled Workers ◽  
Cross Country ◽  
Rich Countries ◽  
Lower Income Countries

We study cross-country differences in the aggregate production function when skilled and unskilled labor are imperfect substitutes. We find that there is a skill bias in cross-country technology differences. Higher-income countries use skilled labor more efficiently than lower-income countries, while they use unskilled labor relatively and, possibly, absolutely less efficiently. We also propose a simple explanation for our findings: rich countries, which are skilled-labor abundant, choose technologies that are best suited to skilled workers; poor countries, which are unskilled-labor abundant, choose technologies more appropriate to unskilled workers. We discuss alternative explanations, such as capital-skill complementarity and differences in schooling quality.

scholarly journals The Indirect Effect of Democracy on Economic Growth in the MENA Region (1990–2015)

2018 ◽  
Author(s):  
Shereen Nosier ◽  
Aya El-Karamani
Keyword(s):  
Economic Growth ◽  
Indirect Effect ◽  
Capital Accumulation ◽  
Trade Openness ◽  
Physical Capital ◽  
Mena Region ◽  
Poor Countries ◽  
Mena Countries ◽  
The One ◽  
Rich Countries

This paper examines the indirect effect of democracy on economic growth using a dataset of 17 MENA countries from 1990 to 2015. Democracy is assumed to affect growth through a series of channels: education, health, physical capital accumulation per labor, government consumption, and trade openness. A system of six simultaneous equations, 3SLS, is used to estimate the effect of democracy on growth through these channels. For further analysis, the countries are classified into groups according to the democratic status on the one side, and the level of income on the other. The results indicate that democracy enhances growth through its positive effect on health in all classifications of countries within the MENA region. However, the effect of democracy on growth through education and physical capital/labor is non-monotonic. Democracy always hinders growth through government size and trade openness. Once all of these indirect effects are accounted for, the overall effect of democracy on growth is negative in less democratic countries and poor countries, but positive in more democratic countries and rich countries.

scholarly journals The Relative Efficiency of Skilled Labor across Countries: Measurement and Interpretation

2022 ◽  
Vol 112 (1) ◽  
pp. 235-266
Author(s):  
Federico Rossi
Keyword(s):  
Human Capital ◽  
Relative Efficiency ◽  
Skilled Labor ◽  
Stages Of Development ◽  
Skill Bias ◽  
Development Accounting ◽  
Country Differences ◽  
Cross Country ◽  
Rich Countries ◽  
High Skill

I study how the relative efficiency of high- and low-skill labor varies across countries. Using microdata for countries at different stages of development, I document that differences in relative quantities and wages are consistent with high-skill workers being relatively more productive in rich countries. I exploit variation in the skill premia of foreign-educated migrants to discriminate between two possible drivers of this pattern: cross-country differences in the skill bias of technology and in the relative human capital of skilled labor. I find that the former is quantitatively more important, and discuss the implications of this result for development accounting. (JEL I26, J24, J31, J61, L16, O15)

scholarly journals Estimating Cross-Country Differences in Product Quality*

2011 ◽  
Vol 126 (1) ◽  
pp. 417-474 ◽  
Author(s):  
Juan Carlos Hallak ◽  
Peter K. Schott
Keyword(s):  
Product Quality ◽  
Country Differences ◽  
Cross Country

scholarly journals Capital Obsolescence and Agricultural Productivity*

2020 ◽  
Vol 136 (1) ◽  
pp. 505-561
Author(s):  
Julieta Caunedo ◽  
Elisa Keller
Keyword(s):  
Labor Productivity ◽  
Productivity Growth ◽  
Agricultural Labor ◽  
Data Set ◽  
Agricultural Labor Productivity ◽  
Country Differences ◽  
Cross Country ◽  
Rich Countries ◽  
Price Differences ◽  
Do So

Abstract This article argues that accounting for capital-embodied technology greatly increases the importance of capital in explaining cross-country differences in agricultural labor productivity. To do so, we draw on a novel data set of agricultural capital prices. We document that new capital is more expensive in richer countries, both in absolute terms and relative to old capital. A model of endogenous adoption of capital of different quality links these price differences to the path of capital-embodied technology. In particular, our model recovers the level of embodied technology from the price of new capital and the growth rate of embodied technology from the price of new capital relative to old capital. We then measure the stocks of quality-adjusted capital in agriculture for a sample of 16 countries at different stages of development. We find that adjusting for differences in quality almost doubles the importance of capital in accounting for cross-country differences in agricultural labor productivity: from 21% to 37%. In addition, improvements in capital quality have been an important source of agricultural labor productivity growth over the past 25 years, accounting for 21% and 35% of the productivity growth in poor and rich countries, respectively.

scholarly journals Do Poor Countries Really Need More IT?

2019 ◽  
Vol 34 (1) ◽  
pp. 48-62 ◽  
Author(s):  
Maya Eden ◽  
Paul Gaggl
Keyword(s):  
Information Technologies ◽  
Technological Capabilities ◽  
It Use ◽  
Systematic Relationship ◽  
Industrial Composition ◽  
Poor Countries ◽  
It Capabilities ◽  
Country Differences ◽  
Cross Country ◽  
Over Time

Abstract Productivity differences across countries are often attributed to differences in technological capabilities. This paper asks whether there are systematic cross-country differences in the adoption of information technologies (IT). We document a positive correlation between IT use and income, which weakens over time. However, given that IT use is an endogenous outcome of both technological capabilities and the abundance of complementary factors of production, it tends to over-state the degree of cross-country differences in technology. We propose two novel calibration approaches to address this problem. After accounting for endogenous differences in industrial composition, we find that there is no systematic relationship between income and IT capabilities.

The impacts of financing constraints on the quality upgrading of China's agri-food exporters

2020 ◽  
Vol 123 (1) ◽  
pp. 301-315
Author(s):  
Xuejun Wang ◽  
Dinghui Huai ◽  
Ze Lu
Keyword(s):  
Product Quality ◽  
Financing Constraints ◽  
National Bureau ◽  
Firm Location ◽  
Food Sector ◽  
Content Type ◽  
Chinese Firm ◽  
Heterogeneous Effects ◽  
Quality Upgrading ◽  
Export Destination

PurposeThe purpose of this paper is to identify the impacts of financing constraints on the quality upgrading of China's agri-food sector.Design/methodology/approachOur empirical study is performed using the “distance to the frontier” framework. We employ a merged sample of Chinese agri-food trading firms based on Chinese firm-level data from the National Bureau of Statistics of China and Chinese customs data. To verify robustness, we test whether the results hold when using different definitions of quality upgrading and alternative proxy variables for product quality and financing constraints. To examine the heterogeneous effects, we generate subsamples by firm location, export destination and the product sophistication of exports.FindingsThe results suggest that financing constraints have a significant negative impact on the product quality upgrading of Chinese agri-food export firms. In addition, the negative impacts of financing constraints are more severe for firms close to the quality frontier than for those far from the frontier. These results are robust to various checks. Moreover, the heterogeneous effects of financing constraints on quality upgrading are identified when the sample is split according to firm location, export destination and the sophistication of export products.Originality/valueThis paper reviews and applies some recent studies in the literature to investigate the relationship between financing constraints and the product quality upgrading of agri-food export firms in China. Overall, the results of this paper could be considered of importance for promoting the quality upgrading of export products in the China's agri-food sector.

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