Abstract
Trade and investment liberalization has been one of the key features of economic policy in many developing countries since the 1990s. Research on this subject has consistently produced more evidence on the benefits of globalization; theoretical studies give more attention to what happens within an industry when trade and liberalization occur, while empirical studies confirm the positive impact of trade liberalization. We review some recent studies on the subject of firms in a globalized economy to enable us to understand more about how firms respond to globalization or changes in trade and investment liberalization. We focus on presenting or explaining the underlying mechanisms through which the effects are realized. The studies we summarized generally confirm the positive impact of trade liberalization on productivity or the spectrum of measures reflecting productivity, such as product quality, firm size, or skill intensity. The positive impact goes through various channels, including competition and industry dynamics, exporting and innovation decisions, and production or investment decisions.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
