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The Theoretical Equivalent of Empirically Measurable Exporter Productivity when Firms are Heterogeneous

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  • wp 2010_06

    Submitted manuscript, 163 KB, PDF document

The marginal costs based representation of firm productivity
in the Melitz [Melitz, M.J., 2003. The impact of trade on
intra-industry reallocations and aggregate industry productiv-
ity. Econometrica 71 (6), 1695-1725] model, predicts positive
exporter productivity premia. We show that this prediction
is reversible when computing the theoretical equivalent of the
empirically measurable productivity expression (value added per
worker) in the model. The paper discusses implications of this
finding for empirical research.
Original languageEnglish
Place of publicationAarhus
Publisher School of Economics and Management, Aarhus University
Number of pages11
Publication statusPublished - 2010

    Research areas

  • Intra-industry trade, firm productivity, heterogeneous firms

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