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| Author: | Gu, W. Sawchuk, G. Whewell Rennison, L. |
| Title: | The effect of tariff reductions on firm size and firm turnover in Canadian manufacturing |
| Journal: | Weltwirtschaftliches Archiv
2003 : VOL. 139:3, p. 440-459 |
| Index terms: | Companies by size Exit conditions Free trade Manufacturing industry Productivity Canada |
| Language: | eng |
| Abstract: | The authors use panel data on 81 Canadian manufacturing industries over period of 1983 to 1996 and show that the estimated impact of recent tariff cuts was a positive and significant increase in the exit rate of companies. Supplementing this finding with recent research showing that exiting companies tend to be less productive than those that survive, this provides support for recent trade models asserting that increased exposure to international trade induces the exit of least efficient companies, thereby contributing to productivity growth. |
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