We investigate how the import of automation impacts upgrading within firm production networks. We use comprehensive data on product mix, foreign trade, balance sheets, employment, and firm-to-firm transactions for Turkish manufacturing firms from 2009 to 2020. By employing Propensity Score Matching (PSM) alongside event study analyses and an instrumental variable (IV) approach, our research provides robust evidence that firms importing automation enhance the quality and lower quality-adjusted prices of their products. Importantly, the benefits of automation extend downstream throughout the supply chain to firms sourcing inputs from suppliers that have adopted automation. No significant effects propagate, instead, to upstream firms supplying automation adopters.
Koymen Ozer, S., Lo Turco, A., Maggioni, D., Automation Imports and Upgrading in Firm Production Networks, <<Working Papers, Universita' Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali>>, 2025; (495): 1-43 [https://hdl.handle.net/10807/324263]
Automation Imports and Upgrading in Firm Production Networks
Maggioni, Daniela
Ultimo
2025
Abstract
We investigate how the import of automation impacts upgrading within firm production networks. We use comprehensive data on product mix, foreign trade, balance sheets, employment, and firm-to-firm transactions for Turkish manufacturing firms from 2009 to 2020. By employing Propensity Score Matching (PSM) alongside event study analyses and an instrumental variable (IV) approach, our research provides robust evidence that firms importing automation enhance the quality and lower quality-adjusted prices of their products. Importantly, the benefits of automation extend downstream throughout the supply chain to firms sourcing inputs from suppliers that have adopted automation. No significant effects propagate, instead, to upstream firms supplying automation adopters.
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