Robot adoption and export sophistication: Firm-level evidence from China

Abstract

This study investigates the impact of robot adoption on the export sophistication of Chinese firms, utilizing the firm-level matching data from the Chinese Customs Trade Statistics and the Annual Survey of Industrial Firms between 2000 and 2013. We develop a firm-level export sophistication index based on Hausmann's index of a country's exporting productivity and employ several empirical strategies to identify the causal effect. The results indicate that a 1 % increase in the adoption of industrial robots can lead to a 0.020 % rise in a firm's export sophistication. The pro-growth effect is more pronounced for non-state-owned, labor-intensive, and large firms. In terms of the underlying mechanisms, we find robot adoption can lead to productivity growth and innovation enhancement and change the employment of labor, ultimately contributing to an improvement in firms' export sophistication.