with Andrew B. Bernard, Renzo Massari, Jose-Daniel Reyes and Daria Taglioni. Forthcoming in American Economic Review
Two identical firms that start exporting in different months, one each in January and December, will report dramatically different exports for the first calendar year. This partial-year effect biases down first year export levels and biases up first year export growth rates. For Peruvian exporters, the partial-year bias is large: first-year export levels are understated by 54 percent and the first year growth rate is overstated by 112 percentage points. Correcting the partial-year effect dramatically reduces first year export growth rates, raises initial export levels and almost doubles the contribution of net firm entry and exit to overall export growth.
with Andreas Moxnes and Karen Helene Ulltveit-Moe, American Economic Review
Media coverage: Vox
This paper studies the impact of an R&D cost shock on R&D investments, imported inputs and their joint impact on firm performance. We introduce imported inputs into a model of R&D and endogenous productivity, and show that R&D and international sourcing are complementary activities. Exploiting the introduction of an R&D tax credit in Norway in 2002, we find that cheaper R&D stimulated not only R&D investments but also imports of intermediates, quantitatively consistent with the model. An implication of our work is that improved access to imported inputs promotes R&D investments and, ultimately, technological change.
Awarded the Best Paper Award at the 14th Annual Postgraduate Conference on Globalisation and Economic Policy, organised by GEP and CEPR, and the FREIT-EITI Best Graduate Paper Prize, 2016
This paper investigates skill-biased technical change at the firm level using rich Norwegian data. In the theoretical framework, firms invest in R&D to enhance their productivity which has a factor-neutral and a skill-biased component. Firms investing in R&D are found to have higher levels and growth rates of skill- biased productivity. The estimated growth rate of skill-biased productivity is sizable enough to account for the majority of the observed increase in the skill premium in Norway over the sample period. The results are supported by exploiting a policy change to estimate the causal effect of innovation on relative skill demand.
with Beata Javorcik and Karen Helene Ulltveit-Moe, CEPR Discussion Paper 10475
Media coverage: Vox
While the impact of globalization on income inequality has received a lot of attention, little is known about its effect on the gender wage gap (GWG). This study argues that there is a systematic difference in the GWG between exporting firms and non-exporters. By the virtue of being technologically more advanced and exposed to higher competition, exporters require greater commitment and flexibility from their employees. If commitment is not easily observable and women are perceived as less committed workers than men, exporters will statistically discriminate against female employees and will exhibit a higher GWG than non-exporters. We test this hypothesis using matched employer-employee data from the Norwegian manufacturing sector from 1996 to 2010. Our identification strategy relies on exogenous shocks, namely, the legislative changes that increased the length of the parental leave that is available only to fathers. We argue that these changes have narrowed the perceived commitment gap between the genders and show that the initially higher GWG observed in exporting firms relative to non-exporters has gone down after the changes took place.