This paper explores how reductions in tariffs on imported inputs and final goods affect firm productivity by exploiting the special tariff treatment that processing firms apply on imported inputs as opposed to those of non-processing firms. Highly disaggregated Chinese transaction-level trade...

In 2005, China abated its fixed exchange rate against the U.S. dollar and began to appreciate the Renminbi (RMB). In this paper, I explore the effect of the appreciation of the RMB on imports to the U.S. from China by augmenting the gravity model with the exchange rate. Using an industrial panel...

In 2005, China abated its fixed exchange rate against the U.S. dollar and began to appreciate the Renminbi (RMB). In this paper, I explore the effect of the appreciation of the RMB on imports to the U.S. from China by augmenting the gravity model with the exchange rate. Using an industrial panel...

Does entry into the export market enhance firms' productivity? In this paper, we estimate the instantaneous and long-run effects of exporting on the productivity of Chinese manufacturing firms during 2001 and 2007. We argue that pre-export R&D plays a crucial role in generating post-entry...

How do reductions in input trade costs affect firm's sales decision between domestic and foreign markets? Aside from tariffs cut in ordinary imports over time, a large extent of firms engaged in duty-free processing trade also experienced a decline in input trade cost. Accordingly, the imported...

This paper provides a comprehensive overview of China's processing trade using highly disaggregated 2010 transaction-level data. By highlighting the key role of processing trade in China's foreign trade, we argue that various free-trade zones have served as important instruments in boosting...

The firm level trade literature finds exporters are exceptional performers for a wide range of countries and measures. Paradoxically, the one documented exception is the world's largest exporter, China. We show that this puzzling finding is entirely driven by firms that engage only in export...

The firm level trade literature finds exporters are exceptional performers for a wide range of countries and measures. Paradoxically, the one documented exception is the world's largest trader, China. We show that this puzzling finding is entirely driven by the presence of firms that engage in...

This paper investigates the impact of trade liberalization on firm productivity by using both Chinese manufacturing firm-level data and highly disaggregated Chinese import data from 1998-2002. We construct a measure of firms' total factor productivity (TFP) by adopting an augmented Olley-Pakes...