Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan

This paper examines productivity dynamics and drivers for Pakistani firms listed in the stock exchange (publicly listed firms) over 2012-17. It relies on policy and outcome measures of integration in upstream merchandise and services sectors, to as...

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Main Authors:	Lovo, Stefania, Varela, Gonzalo
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2020
Subjects:	TRADE AND INVESTMENT MULTINATIONAL ENTERPRISE TOTAL FACTOR PRODUCTIVITY EXPORTS TARIFFS DIRECT FOREIGN INVESTMENT INTERMEDIATE INUPTS DUTY EXEMPTIONS
Online Access:	http://documents.worldbank.org/curated/en/441121596474893570/Internationally-Linked-Firms-Integration-Reforms-and-Productivity-Evidence-from-Pakistan http://hdl.handle.net/10986/34281

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recordtype	oai_dc
spelling	okr-10986-342812022-09-20T00:11:40Z Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan Lovo, Stefania Varela, Gonzalo TRADE AND INVESTMENT MULTINATIONAL ENTERPRISE TOTAL FACTOR PRODUCTIVITY EXPORTS TARIFFS DIRECT FOREIGN INVESTMENT INTERMEDIATE INUPTS DUTY EXEMPTIONS This paper examines productivity dynamics and drivers for Pakistani firms listed in the stock exchange (publicly listed firms) over 2012-17. It relies on policy and outcome measures of integration in upstream merchandise and services sectors, to assess their impact on productivity downstream. The paper presents three main findings. First, the productivity of publicly listed firms remained stagnant over the period, in line with macro-level indicators for Pakistan. Second, foreign-owned or exporting firms are more productive than domestic-owned or domestic-oriented firms. Foreign investors target more productive firms, and their productivity grows after being acquired. Exporters tend to exhibit productivity growth after becoming exporters. Third, increased import duties on intermediates, or reduced levels of foreign direct investment in upstream services sectors, are associated with decreases in the total factor productivity of firms downstream. Gains from lower input tariffs accrue to those that do not secure duty exemption schemes -- domestic-oriented firms or smaller exporters. Gains from upstream services foreign direct investment accrue mostly to firms that are further from the productivity frontier. Taken together, these results suggest that productivity growth in Pakistan would benefit from increased exposure of upstream sectors to global markets. 2020-08-06T14:50:19Z 2020-08-06T14:50:19Z 2020-08 Working Paper http://documents.worldbank.org/curated/en/441121596474893570/Internationally-Linked-Firms-Integration-Reforms-and-Productivity-Evidence-from-Pakistan http://hdl.handle.net/10986/34281 English Policy Research Working Paper;No. 9349 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper South Asia Pakistan
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	TRADE AND INVESTMENT MULTINATIONAL ENTERPRISE TOTAL FACTOR PRODUCTIVITY EXPORTS TARIFFS DIRECT FOREIGN INVESTMENT INTERMEDIATE INUPTS DUTY EXEMPTIONS
spellingShingle	TRADE AND INVESTMENT MULTINATIONAL ENTERPRISE TOTAL FACTOR PRODUCTIVITY EXPORTS TARIFFS DIRECT FOREIGN INVESTMENT INTERMEDIATE INUPTS DUTY EXEMPTIONS Lovo, Stefania Varela, Gonzalo Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan
geographic_facet	South Asia Pakistan
relation	Policy Research Working Paper;No. 9349
description	This paper examines productivity dynamics and drivers for Pakistani firms listed in the stock exchange (publicly listed firms) over 2012-17. It relies on policy and outcome measures of integration in upstream merchandise and services sectors, to assess their impact on productivity downstream. The paper presents three main findings. First, the productivity of publicly listed firms remained stagnant over the period, in line with macro-level indicators for Pakistan. Second, foreign-owned or exporting firms are more productive than domestic-owned or domestic-oriented firms. Foreign investors target more productive firms, and their productivity grows after being acquired. Exporters tend to exhibit productivity growth after becoming exporters. Third, increased import duties on intermediates, or reduced levels of foreign direct investment in upstream services sectors, are associated with decreases in the total factor productivity of firms downstream. Gains from lower input tariffs accrue to those that do not secure duty exemption schemes -- domestic-oriented firms or smaller exporters. Gains from upstream services foreign direct investment accrue mostly to firms that are further from the productivity frontier. Taken together, these results suggest that productivity growth in Pakistan would benefit from increased exposure of upstream sectors to global markets.
format	Working Paper
author	Lovo, Stefania Varela, Gonzalo
author_facet	Lovo, Stefania Varela, Gonzalo
author_sort	Lovo, Stefania
title	Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan
title_short	Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan
title_full	Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan
title_fullStr	Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan
title_full_unstemmed	Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan
title_sort	internationally linked firms, integration reforms and productivity : evidence from pakistan
publisher	World Bank, Washington, DC
publishDate	2020
url	http://documents.worldbank.org/curated/en/441121596474893570/Internationally-Linked-Firms-Integration-Reforms-and-Productivity-Evidence-from-Pakistan http://hdl.handle.net/10986/34281
_version_	1764480567884120064

Internationally Linked Firms, Integration Reforms and Productivity : Evidence from Pakistan

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