Impect on Trade Orgnization Productivity

The Impact of Trade on Organization and Productivity Lorenzo Caliendo Yale University Esteban Rossi-Hansberg Princeton University May 19, 2011 hook A …rm productivity depends on how production is organized addicted the level of demand for its s product. To capture this mechanism, we develop a theory of an economy where …rms with heterogeneous demands use labor and intimacy to produce. Entrepreneurs decide the number of layers of management and the knowledge and span of instruction of each agent. As a result, in the theory, heterogeneity in demand leads to heterogeneity in productivity and other …rms outcomes. We use the theory to analyze the impact of international trade on organization and calibrate the model to the U.S. economy. Our results indicate that, as a result of a bilateral trade liberalization, …rms that export go away increase the number of layers of management and will decentralize decisions. The in the raw organization of the average exporter results in higher productivity, although the responses of productivity atomic number 18 heterogeneous across these …rms. In contrast, non-exporters reduce their number of layers, decentralization, and, on average, their productivity. The marginal exporter increases its productivity by about 1% and its tax productivity by about 1.8%. 1.

INTRODUCTION Production requires organization. In order to produce …rms need to hire managers that organize inputs, that reckon the problems that arise in production, and that plan for the future, among other tasks. As a result, the productivity of a …rm depends on the way its production is organized. Of course, how ofttimes a …rm is willing to invest in organizing its production by hiring a hierarchy of managers, with di¤erent amounts of knowledge and particular tasks within the …rm, depends on the scale of its output. It would be clearly ine¢ cient for a small family championship to have the same organizational structure as a large multinational …rm that sells all around the world. These di¤erences... If you want to hold a full essay, order it on our website: Ordercustompaper.com

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