Trade policy and input liberalization : the effect on Egyptian firms’ productivity

Abstract EN

This paper explores the link between trade liberalization and firms’ performance in Egypt combining macro and micro data.

Using the Economic Census of Egypt 2013, we examine the association between tariffs and non-tariffs measures (NTM) imposed on intermediate inputs and total factor productivity (TFP).

In a first step TFP is estimated as the residual of a Cobb-Douglas/Translog production function and in the second, TFP is regressed on weighted tariffs and NTM imposed on intermediate inputs.

Egyptian inputoutput tables are used to construct the weights.

Our main findings show a positive and significant association between imported inputs and value-added and a significantly negative relationship between tariffs and TFP