Aktuelle Arbeitspapiere

Robots and Firms

Marcel Smolka, Michael Koch, Ilya Manuylov (December 2020)

Conditionally accepted at Economic Journal

We study the microeconomic implications of robot adoption using a rich panel data-set of Spanish manufacturing firms over a 27-year period (1990-2016). We provide causal evidence on two central questions: (1) Which firm characteristics prompt firms to adopt robots? (2) What is the impact of robots on adopting firms relative to non-adopting firms? To address these questions, we look at our data through the lens of recent attempts in the literature to formalize the implications of robot technology. As for the first question, we establish robust evidence for positive selection, i.e., ex-ante better performing firms (measured through output and labour productivity) are more likely to adopt robots. On the other hand, conditional on size, ex-ante more skill-intensive firms are less likely to do so. As for the second question, we find that robot adoption generates substantial output gains in the vicinity of 20-25% within four years, reduces the labour cost share by 5-7%-points, and leads to net job creation at a rate of 10%. These results are robust to controlling for non-random selection into robot adoption through a difference-in-differences approach combined with a propensity score reweighting estimator. To further validate these results, we also offer structural estimates of total factor productivity (TFP) where robot technology enters the (endogenous) productivity process of firms. The results demonstrate a positive causal effect of robots on productivity, as well as a complementarity between robots and exporting in boosting productivity.

The paper can be found here.

Productivity and Firm Boundaries

Marcel Smolka, Wilhelm Kohler (April 2020)

Revise and resbumit at European Economic Review

We use a property rights model of sourcing to derive novel theoretical predictions on how the productivity of a firm affects its choice between vertical integration and outsourcing and how this effect varies with the sourcing intensity of the production process. Our predictions hinge on less restrictive assumptions than industry-level predictions available in existing literature and survive in more realistic versions of the model featuring multiple suppliers. We present robust firm-level evidence from Spain showing that, in line with our prediction, the effect of productivity works more strongly in favor of vertical integration, and against outsourcing, in more headquarter-intensive industries.

The paper can be found here.

Firm Exports, Foreign Ownership, and the Global Financial Crisis

Marcel Smolka, Peter S. Eppinger (December 2020)

The exceptional export performance of foreign-owned firms is a well-established stylized fact, but the underlying mechanism is not yet fully understood. In this paper, we provide theory and empirical evidence demonstrating that this fact can be explained by ownership differences in access to finance. We develop a theoretical model of international trade featuring firm heterogeneity and credit market frictions in which foreign-owned firms can access foreign capital markets via their multinational parents. The model predicts a financial advantage of foreign ownership for exporting that gains importance as credit conditions deteriorate. To empirically identify this effect, we estimate a triple differences model using rich micro data from Spain that exploits the global financial crisis as an exogenous shock to credit supply. We find that foreign ownership significantly stabilized firm exports when liquidity dried out in the crisis, in particular among small and financially vulnerable firms.

The paper can be found here.

The Economics of Processing Trade

Marcel Smolka, Boris Georgiev, Michael Koch

[work in progress]