02242cas a2200277 a 4500 AALejournalIMF016730 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475546774 1018-5941 BD-DhAAL BD-DhAAL Ahn, JaeBin. Reassessing the Productivity Gains from Trade Liberalization / JaeBin Ahn, Era Dabla-Norris, Romain Duval, Bingjie Hu. Washington, D.C. : International Monetary Fund, 2016. 1 online resource (31 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper reassesses the impact of trade liberalization on productivity. We build a new, unique database of effective tariff rates at the country-industry level for a broad range of countries over the past two decades. We then explore both the direct effect of liberalization in the sector considered, as well as its indirect impact in downstream industries via input linkages. Our findings point to a dominant role of the indirect input market channel in fostering productivity gains. A 1 percentage point decline in input tariffs is estimated to increase total factor productivity by about 2 percent in the sector considered. For advanced economies, the implied potential productivity gains from fully eliminating remaining tariffs are estimated at around 1 percent, on average, which do not factor in the presumably larger gains from removing existing non-tariff barriers. Finally, we find strong evidence of complementarities between trade and FDI liberalization in boosting productivity. This calls for a broad liberalization agenda that cuts across different areas. Mode of access: Internet Dabla-Norris, Era. Duval, Romain. Hu, Bingjie. IMF Working Papers; Working Paper ; No. 2016/077 Full text available on IMF http://elibrary.imf.org/view/journals/001/2016/077/001.2016.issue-077-en.xml IMF e-Library