Trade policy and input liberalization: The effect on Egyptian firms' productivity

This paper explores the link between trade liberalization and firms'performance in Egypt combining macro and micro data. Using theEconomic Census of Egypt 2013, we examine the association betweentariffs and non-tariffs measures (NTM) imposed on intermediate inputsand total factor productivity (TFP). In a first step TFP is estimated as theresidual of a Cobb-Douglas/Translog production function and in thesecond, TFP is regressed on weighted tariffs and NTM imposed onintermediate inputs. Egyptian input-output tables are used to constructthe weights. Our main findings show a positive and significant association between imported inputs and value-added and a significantly negative relationship between tariffs and TFP.