Stephen Teng Sun
City University of Hong Kong
Institutional Affiliation: Peking University
NBER Working Papers and Publications
|June 2018||Managing Trade: Evidence from China and the US|
with Nicholas Bloom, Kalina Manova, John Van Reenen, Zhihong Yu: w24718
We present a heterogeneous-firm model in which management ability increases both production efficiency and product quality. Combining six micro-datasets on management practices, production and trade in Chinese and American firms, we find broad support for the model's predictions. First, better managed firms are more likely to export, sell more products to more destination countries, and earn higher export revenues and profits. Second, better managed exporters have higher prices, higher quality, and lower quality-adjusted prices. Finally, they also use a wider range of inputs, higher quality and more expensive inputs, and imported inputs from more advanced countries. The structural estimates indicate that management is important for improving production efficiency and product quality in bot...