Research

Do Productivity Shocks Cause Inputs Misallocation?

Under Review

This paper investigates how productivity dispersion relates to input misallocation using a model with staggered productivity shocks that create wedges between anticipated and realized productivity for any production input. With inputs allocated optimally ex ante but suboptimally ex post, dispersion in realized productivity contributes to ex post input misallocation. Analyzing European firm data from 2000–2017 reveals significant co-movement between productivity dispersion and capital/labor misallocation across industries. Productivity dispersion explains a substantial share of capital and labor misallocation (40% and 70%), and 10% of materials misallocation, confirming its key role in allocation frictions.

[Versions Repo (arXiv)] [Preprint] 

In Search of (Factor-Biased) Learning by Exporting 

Joint with Joonkyo Hong

Under Review

Exporting plants often undergo significant technology upgrades, becoming more productive than their domestic counterparts. This process, called learning by exporting, is usually modeled as a Hicks-neutral TFP shifter, overlooking factor-biased technical improvements. We develop a dynamic model of production, exporting, and capital investment that incorporates factor-augmenting efficiencies.We find that exporting increases TFP by 9%, skilled labor productivity by 2%, and unskilled labor productivity by 8%. For new exporters, skilled labor productivity rises by 45%, and unskilled labor productivity increases by 75% within four years of entering export markets.

[Versions Repo (arXiv)] [Preprint]