Productivity dynamics of the colombian manufacturing sector

This paper analyzes the effects on Colombian manufacturing productivity of tax and foreign trade policy changes during the 1990s. Our results indicate that between 1977 and 1999, aggregate manufacturing productivity largely stagnates and even declines in some of the larger industries. There is littl...

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Autores:
Meléndez Alarcón, María Marcela
Seim, Katja
Medina Fajardo, Pablo
Tipo de recurso:
Work document
Fecha de publicación:
2003
Institución:
Universidad de los Andes
Repositorio:
Séneca: repositorio Uniandes
Idioma:
eng
OAI Identifier:
oai:repositorio.uniandes.edu.co:1992/8458
Acceso en línea:
http://hdl.handle.net/1992/8458
Palabra clave:
Productivity dynamics
Manufacturing sector
Preferential treatments
Tax exemptions
Industria manufacturera - Aspectos económicos - Colombia - 1977-1999
Industria manufacturera - Exención de impuestos - Colombia - 1977-1999
C14, C23, D24, F13, H3, L6
Rights
openAccess
License
http://creativecommons.org/licenses/by-nc-nd/4.0/
Description
Summary:This paper analyzes the effects on Colombian manufacturing productivity of tax and foreign trade policy changes during the 1990s. Our results indicate that between 1977 and 1999, aggregate manufacturing productivity largely stagnates and even declines in some of the larger industries. There is little entry and exit of plants or reallocation of labor. The productivity stagnation can be explained by this lack of liquidation of unproductive plants combined with slow technological advance. Dynamics vary significantly across sub-sectors, however, and our findings attribute this variation primarily to within-sector output reallocation. The importance of industrial policy is large. Sector-level productivity declines coincide with protectionist policies in the form of import tariffs or beneficial tax treatments, while higher productivity levels are correlated with sectors' increasing foreign exposure. Our finding of small productivity effects of preferential treatments further points to the insignificant role played by output reallocation across plants in stimulating productivity growth.