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European Review of Agricultural Economics 2008 35(4):439-460; doi:10.1093/erae/jbn034
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© Oxford University Press and Foundation for the European Review of Agricultural Economics 2009; all rights reserved. For permissions, please email journals.permissions@oxfordjournals.org

Global productivity distribution and trade liberalisation: evidence from processed food industries

Jun Ruan

Momentum Market Intelligence, Oregon, USA

Munisamy Gopinath

Department of Agricultural and Resource Economics, Oregon State University, USA

Corresponding author: Munisamy Gopinath, 213 Ballard Hall, Oregon State University, Corvallis, OR 97331, USA. E-mail: m.gopinath{at}oregonstate.edu

Received April 2008; final version received October 2008

In this study, we test the hypothesis that an industry's average productivity increases with liberalised trade in the context of processed food industries. Furthermore, we examine the resulting cross-country resource and market share reallocation in these industries. For this purpose, we employ a kernel density estimator to approximate the global productivity distribution in five major processed food industries for every period between 1993 and 2000. We find that the mean and alternative percentiles of the global productivity distribution shift to the right with liberalised international trade. Moreover, countries with faster productivity growth than the global average benefit from trade liberalisation by acquiring a larger share of global markets and resources.

Keywords: productivity distribution, resource reallocation, trade liberalisation

JEL classification: F14, L66, O33


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