The Heterogeneous Impact of Tariffs and Ntms on Total Factor Productivity for Indonesian Firms

Dados Bibliográficos

ID8416136
AutoresKrisna Gupta (0000-0001-8695-0514, Jakarta State Polytechnic, autor correspondente)
Ano2023
Volume59
Fascículo2
Páginas269-300
Data de publicação2023-05-04
Peer ReviewedSim
Open AccessNão
TipoARTICLE
PeriódicoBulletin of Indonesian Economic Studies (JOURNAL)
Identificadores do periódicoISSN: 0007-4918 • E-ISSN: 1472-7234
EditoraInforma UK Limited (PUBLISHER • GB)
DOI10.1080/00074918.2021.2016613
OpenAlexW4205683003
IdiomaEN
Citações recebidas4
Referências citadas27

The Indonesian government has been working hard to engage with the world market as tariffs continue to decrease. However, the government seems to be following the global trend of relying on non-tariff measures (NTMs) to regulate the Indonesian market and protect the country’s industries. This paper assesses whether these measures hurt firms by limiting their access to better quality and cheaper foreign inputs. It builds on the findings of Amiti and Konings (2007) by assessing the impact of trade policy shocks on firms’ total factor productivity (TFP). It finds that tariffs and NTMs hurt firms’ TFP significantly and reduce employment. The impact is less severe for bigger firms, confirming the heterogeneous effect of trade policy. The results suggest unintended consequences of protectionism in the Indonesian market. Moreover, as the country seeks to boost foreign investment, more protectionism may be used to keep mark-ups in the domestic market high as an incentive

Business · Economics · Foreign direct investment · Government (linguistics) · Incentive · Indonesian · Indonesian government · International economics · International trade · Investment (military) · Macroeconomics · Market economy · Productivity · Protectionism · Quality (philosophy) · Tariff · Total factor productivity · Global Trade and Competitiveness · Global trade and economics · International Business and FDI