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Do Trade Policy Differences Induce Sorting? Theory and Evidence from Bangladeshi Apparel Exporters / Svetlana Demidova, Hiau Looi Kee, Kala Krishna.
- Format:
- Book
- Author/Creator:
- Demidova, Svetlana.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w12725.
- NBER working paper series no. w12725
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2006.
- Summary:
- This paper provides a new heterogeneous firm model for trade where firms differ in their productivity and experience different market demand shocks. The model incorporates variations in trade policy, trade preferences, and the rules of origin needed to obtain them, to reflect real world differences faced by Bangladeshi garment exporters in the US and EU. We estimate firms' productivity using an extension of the Olley Pakes procedure that accounts for the biases arising from both demand shocks and productivity being unobserved. Predictions of the model are then tested non-parametrically and are shown to be supported empirically.
- Notes:
- Print version record
- December 2006.
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