Estimation of productivity and markups with price dispersion: Evidence from Chinese manufacturing during economic transition.
We estimate firm productivity and markups in the presence of heterogeneous output and input prices. We assume that firms are monopolistically competitive in the output market and that state firms are favored and pay lower prices for inputs due to political connections. The proxy‐variable (or called...
| Published in: | Southern Economic Journal Vol. 87; no. 2; pp. 666 - 700 |
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| Main Authors: | , , |
| Format: | Article |
| Published: |
Wiley-Blackwell
Oct2020
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| Subjects: | |
| Online Access: | View this record in EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=146607931&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 146607931 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00384038 SEJ jtl: Southern Economic Journal issn: 00384038 maglogo: N pubinfo: dt: Oct2020 vid: 87 iid: 2 pid: 480 pub: Wiley-Blackwell artinfo: ui: 146607931 10.1002/soej.12457 ppf: 666 ppct: 34 formats: fmt: – @attributes: type: T – @attributes: type: C – @attributes: type: P size: 3.9MB tig: atl: Estimation of productivity and markups with price dispersion: Evidence from Chinese manufacturing during economic transition. aug: au: Zhao, Shunan Qian, Bing Kumbhakar, Subal C. affil: Department of Economics, Oakland University, Rochester Michigan, USA Institute of Economics, Chinese Academy of Social Sciences, Beijing, China School of Economics and Management, Changzhou Institute of Technology, Changzhou Jiangsu,, China Department of Economics, State University of New York at Binghamton, Binghamton New York, USA Stavanger Business School, Stavanger, Norway su: China Price markup Transportation equipment industry Dispersion (Chemistry) sug: subj: China Transportation Equipment and Supplies (except Motor Vehicle) Merchant Wholesalers Other transportation equipment manufacturing All Other Transportation Equipment Manufacturing Price markup Transportation equipment industry Dispersion (Chemistry) keyword: identification markup price dispersion production function productivity semiparametric estimation identification markup price dispersion production function productivity semiparametric estimation ab: We estimate firm productivity and markups in the presence of heterogeneous output and input prices. We assume that firms are monopolistically competitive in the output market and that state firms are favored and pay lower prices for inputs due to political connections. The proxy‐variable (or called the control‐function‐based) approach of structurally identifying production functions and productivity is customized to our new setting. Our approach solves the underidentification problem inherent in the standard proxy‐variable method. We investigate the Chinese transportation equipment industry and find evidence against perfect competition and price homogeneity. We also find that productivity and markup differentials and dynamics are consistent with the market‐oriented reforms in China. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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