Publication: Services liberalization and productivity of manufacturing firms : Evidence from Ukraine
Loading...
Date
2012-01-01
ISSN
Published
2012-01-01
Author(s)
Editor(s)
Abstract
This paper brings new evidence on the impact of services liberalization on the performance of manufacturing firms. Using a unique database of Ukrainian firms in 2001-2007, the authors utilize an external push for liberalization in the services sector as a source of exogenous variation to identify the impact of services liberalization on total factor productivity (TFP) of manufacturing firms. The results indicate that a standard deviation increase in services liberalization is associated with a 9 percent increase in TFP. Allowing services liberalization to dynamically influence TFP through the investment channel leads to an even larger effect. The effect is robust to different estimation methods and to different sub-samples of the data. In particular, it is more pronounced for domestic and small firms.
Link to Data Set
Citation
“Shepotylo, Oleksandr; Vakhitov, Volodymyr. 2012. Services liberalization and productivity of manufacturing firms : Evidence from Ukraine. Policy Research working paper ; no. WPS 5944. © World Bank. http://hdl.handle.net/10986/3229 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Error: Could not load results for '/discover/search/objects?query=relation.isSeriesOfPublication%3A26e071dc-b0bf-409c-b982-df2970295c87&f.resourceid=b5b2a93e-c7f4-5926-a30c-a6e764918239,notequals'.
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication The Impact on Russia of WTO Accession and The Doha Agenda : The Importance of Liberalization of Barriers against Foreign Direct Investment in Services for Growth and Poverty Reduction(World Bank, Washington, DC, 2005-10)Taking price changes from the Global Trade Analysis Project (GTAP) model of world trade, the authors use a small open economy computable general equilibrium comparative static model of the Russian economy to assess the impact of global free trade and a successful completion of the Doha Agenda on the Russian economy, and especially on the poor. They compare those results with the impact of Russian accession to the World Trade Organization (WTO) on income distribution and the poor. The model incorporates all 55,000 households from the Russian Household Budget Survey as "real" households. Crucially, given the importance of foreign direct investment (FDI) liberalization as part of Russian WTO accession, the authors also include FDI and Dixit-Stiglitz endogenous productivity effects from liberalization of import barriers against goods and FDI in services. The authors estimate that Russian WTO accession in the medium run will result in gains averaged over all Russian households equal to 7.3 percent of Russian consumption (with a standard deviation of 2.2 percent of consumption), with virtually all households gaining. They find that global free trade would result in a weighted average gain to households in Russia of 0.2 percent of consumption, with a standard deviation of 0.2 percent of consumption, while a successful completion of the Doha Development Agenda would result in a weighted average gain to households of -0.3 percent of consumption (with a standard deviation of 0.2 percent of consumption). Russia, as a net food importer, loses from subsidy elimination, and the gains to Russia from tariff cuts in other countries are too small to offset these losses. The results strongly support the view that Russia's own liberalization is more important than improvements in market access as a result of reforms in tariffs or subsidies in the rest of the world. Foremost among the own reforms is liberalization of barriers against FDI in business services.Publication Services Trade and Growth(World Bank, Washington, DC, 2008-01)The competitiveness of firms in open economies is increasingly determined by access to low-cost and high-quality producer services - telecommunications, transport and distribution services, financial intermediation, etc. This paper discusses the role of services in economic growth, focusing in particular on channels through which openness to trade in services may increase productivity at the level of the economy as a whole, industries and the firm. The authors explore what recent empirical work suggests could be done to enhance comparative advantage in the production and export of services and how to design policy reforms to open services markets to greater foreign participation in a way that ensures not just greater efficiency but also greater equity in terms of access to services.Publication Malawi - Country Economic Memorandum : Seizing Opportunities for Growth through Regional Integration and Trade - Summary of Main Finding and Recommendations(World Bank, 2010-01-31)Malawi needs to focus on exports to maintain and broaden its current inspiring levels of economic growth. The focus of future policy should therefore be on reforms that improve competitiveness in global and regional markets. This does not require a fundamental shift in direction, but instead a rebalancing of policy and expenditures to support an outward-oriented development framework. Until the recent global financial crisis, domestic and regional trends were promising for Malawi: rapid economic growth, strong donor support, increases in foreign direct investment, real potential to upgrade regional infrastructure, and the gradual dismantling of barriers within the region through the Common Market for Eastern and Southern Africa (COMESA) and Southern Africa Development Community (SADC) free trade areas. Despite recent global developments, this report makes the case that, for a small landlocked economy like Malawi, integration into a dynamic and more open Southern Africa region will remain a key to building prosperity and improving livelihoods.Publication Services Reform and Manufacturing Performance : Evidence from India(2012-01-01)The growth of India's manufacturing sector since 1991 has been attributed mostly to trade liberalization and more permissive industrial licensing. This paper demonstrates the significant impact of a neglected factor: India's policy reforms in services. The authors examine the link between those reforms and the productivity of manufacturing firms using panel data for about 4,000 Indian firms froPublication Putting Services and Foreign Direct Investment with Endogenous Productivity Effects in Computable General Equilibrium Models(World Bank, Washington, DC, 2012-03)With the growing importance of services and foreign direct investment in services, it is important to have a framework to analyze the impact of the liberalization of barriers to foreign direct investment in services. This paper summarizes several recent papers and builds policy-based computable general equilibrium models showing the dynamics of services, foreign direct investment and the endogenous productivity effect from services. The modeling framework shows that the liberalization of barriers against foreign direct investment in services yields welfare gains several times larger than the usual estimates from traditional computable general equilibrium models, which focus on goods trade, not foreign direct investment in services. The larger estimates are consistent with econometric evidence on the gains from services liberalization. The paper begins with a small stylized model to help understand the fundamental economics. Then it describes models developed at the request of the Russian government to assess the potential impact of Russia's accession to the WTO. Reviews of the work indicated that the modeling helped the Russian government gain public support for the WTO entry. The paper also describes a new technique that allows modelers to include tens of thousands of households in the model.
Users also downloaded
Showing related downloaded files
Publication Argentina Country Climate and Development Report(World Bank, Washington, DC, 2022-11)The Argentina Country Climate and Development Report (CCDR) explores opportunities and identifies trade-offs for aligning Argentina’s growth and poverty reduction policies with its commitments on, and its ability to withstand, climate change. It assesses how the country can: reduce its vulnerability to climate shocks through targeted public and private investments and adequation of social protection. The report also shows how Argentina can seize the benefits of a global decarbonization path to sustain a more robust economic growth through further development of Argentina’s potential for renewable energy, energy efficiency actions, the lithium value chain, as well as climate-smart agriculture (and land use) options. Given Argentina’s context, this CCDR focuses on win-win policies and investments, which have large co-benefits or can contribute to raising the country’s growth while helping to adapt the economy, also considering how human capital actions can accompany a just transition.Publication Guide to the Debt Management Performance Assessment Tool(Washington, DC, 2008-02-05)The purpose of this document is to provide guidance and supplemental information to assist with country assessments of debt management performance, using the Debt Management Performance Assessment (DeMPA) tool. The DeMPA is a methodology used for assessing public debt management performance through a comprehensive set of 15 performance indicators spanning the full range of government Debt Management (DeM) functions. It is based on the principles set out in the International Monetary Fund (IMF) and World Bank guidelines for public debt management, initially published in 2001 and updated in 2003. It is modeled after the Public Expenditure and Financial Accountability (PEFA) framework for performance measurement of public financial management. The DeMPA has been designed to be a user-friendly tool to undertake an assessment of the strengths and weaknesses in government DeM practices. This guide provides additional background and supporting information so that a no specialist in the area of debt management may undertake a country assessment effectively. The guide can be used by assessors in preparing for and undertaking an assessment. It is particularly useful for understanding the rationale for the inclusion of the indicators, the scoring methodology, and the list of supporting documents or evidence required, and the questions that could be asked for the assessment.Publication Classroom Assessment to Support Foundational Literacy(Washington, DC: World Bank, 2025-03-21)This document focuses primarily on how classroom assessment activities can measure students’ literacy skills as they progress along a learning trajectory towards reading fluently and with comprehension by the end of primary school grades. The document addresses considerations regarding the design and implementation of early grade reading classroom assessment, provides examples of assessment activities from a variety of countries and contexts, and discusses the importance of incorporating classroom assessment practices into teacher training and professional development opportunities for teachers. The structure of the document is as follows. The first section presents definitions and addresses basic questions on classroom assessment. Section 2 covers the intersection between assessment and early grade reading by discussing how learning assessment can measure early grade reading skills following the reading learning trajectory. Section 3 compares some of the most common early grade literacy assessment tools with respect to the early grade reading skills and developmental phases. Section 4 of the document addresses teacher training considerations in developing, scoring, and using early grade reading assessment. Additional issues in assessing reading skills in the classroom and using assessment results to improve teaching and learning are reviewed in section 5. Throughout the document, country cases are presented to demonstrate how assessment activities can be implemented in the classroom in different contexts.Publication Crime and Violence in Central America : A Development Challenge - Main Report(World Bank, 2011-01-01)Crime and violence are now a key development issue for Central American countries. In three nations El Salvador, Guatemala, and Honduras crime rates are among the top five in Latin America. This report argues that successful strategies require actions along multiple fronts, combining prevention and criminal justice reform, together with regional approaches in the areas of drug trafficking and firearms. It also argues that interventions should be evidence based, starting with a clear understanding of the risk factors involved and ending with a careful evaluation of how any planned action might affect future options. In addition, the design of national crime reduction plans and the establishment of national cross-sectoral crime commissions are important steps to coordinate the actions of different government branches, ease cross-sectoral collaboration and prioritize resource allocation. Of equal importance is the fact that national plans offer a vehicle for the involvement of civil society organizations, in which much of the expertise in violence prevention and rehabilitation resides. Prevention efforts need to be complemented by effective law enforcement. The required reforms are no longer primarily legislative in nature because all six countries have advanced toward more transparent adversarial criminal procedures. The second-generation reforms should instead help deliver on the promises of previous reforms by: (i) strengthening key institutions and improving the quality and timeliness of the services they provide to citizens; (ii) improving efficiency and effectiveness while respecting due process and human rights; (iii) ensuring accountability and addressing corruption; (iv) increasing inter-agency collaboration; and (v) improving access to justice, especially for poor and disenfranchised groups. Specific interventions reviewed in the report include: information systems and performance indicators as a prerequisite to improve inter-institutional coordination and information sharing mechanisms; an internal overhaul of court administration and case management to create rapid reaction, one-stop shops; the strengthening of entities that provide legal counseling to the poor and to women; and the promotion of alternative dispute-resolution mechanisms and the implementation of community policing programs.Publication The Mexican Social Protection System in Health(World Bank, Washington DC, 2013-01)With a population of 113 million and a per-capita Gross Domestic Product, or GDP of US$10,064 (current U.S. dollars), Mexico is one of the largest and highest-income countries in Latin America and the Caribbean (LAC). The country has benefited from sustained economic growth during the last decade, which was temporarily interrupted by the financial and economic crisis. Real GDP is projected to grow 3.8 percent and 3.6 percent in 2012 and 2013, respectively (International Monetary Fund, or IMF 2012). Despite this growth, poverty in the country remains high; with half of the population living below the national poverty line. The country is also highly heterogeneous, with large socioeconomic differences across states and across urban and rural areas. In 2010, while the extreme poverty ratio in the Federal District and the states of Colima and Nuevo Leon was below 3 percent, in Chiapas, Guerrero, and Oaxaca it was 25 percent or higher. These large regional differences are also found in other indicators of well-being, such as years of schooling, housing conditions, and access to social services. This case study assesses key features and achievements of the Social Protection System in Health (Sistema de Proteccion Social en Salud) in Mexico, and particularly of its main pillar, Popular Health Insurance (Seguro Popular, PHI). It analyzes the contribution of this policy to the establishment and implementation of universal health coverage in Mexico. In 2003, with the reform of the General Health Law, the PHI was institutionalized as a subsidized health insurance scheme open to the population not covered by the social security schemes. Today, the PHI covers all of its intended affiliates, about 52 million people