Working Paper: CEPR ID: DP1301
Authors: Simeon Djankov; Bernard Hoekman
Abstract: This paper empirically tests the link between trade openness and enterprise restructuring in Bulgaria. It belongs to a recent line of work in the empirical trade literature that investigates the effects of trade policy on firm behaviour. The trade liberalization following the 1991 economic reforms is found to have a strong impact on firm-level restructuring and industry concentration. Between 1992 and 1994, the impact of export opportunities on restructuring was particularly important.
Keywords: trade liberalization; restructuring; economic adjustment
JEL Codes: F14; O12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| increased trade openness (F19) | significant restructuring efforts within firms (L16) |
| greater import competition (F69) | decline in employment (J63) |
| increased import competition (F69) | reduction in industry concentration (L59) |
| highest levels of trade openness (F19) | greatest improvements in operating profitability (L21) |