TY  - JOUR
AU  - Amiti,Mary
AU  - Khandelwal,Amit K.
TI  - Import Competition and Quality Upgrading
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 15503
PY  - 2009
Y2  - November 2009
UR  - http://www.nber.org/papers/w15503
L1  - http://www.nber.org/papers/w15503.pdf
N1  - Author contact info:
Mary Amiti
International Research
Federal Reserve Bank of New York
33 Liberty St
New York, NY 10045-0001
E-Mail: Mary.Amiti@ny.frb.org

Amit Khandelwal
Graduate School of Business
Columbia University
Uris Hall 606, 3022 Broadway
New York, NY 10027
Tel: 212/854-7506
Fax: 212/316-9219
E-Mail: ak2796@columbia.edu
AB  - It is important to understand the factors that influence a country's transition from the production of low-quality to high-quality products since the production of high-quality goods is often viewed as a pre-condition for export success and, ultimately, for economic development. In this paper, we provide the first evidence that countries' import tariffs affect the rate at which they upgrade the quality of their products. We analyze the effect of import competition on quality upgrading using highly disaggregated export data to the U.S. from fifty-six countries in 10,000 products using a novel approach to measure quality. As predicted by recent distance to the frontier models, we find that lower tariffs are associated with quality upgrading for products close to the world quality frontier, whereas lower tariffs discourage quality upgrading for products distant from the frontier.
ER  -