Export Market Destinations, Imported Intermediates, and Productivity: Firm-level Evidence from Ghana

Abstract

ABSTRACT This article explores whether the use of imported intermediates has a moderating impact on the productivity effects of export market destinations using data from Ghanaian manufacturing firms over the period of 1991 to 2002. The results show that the use of imported inputs in the production process helps firms that export outside Africa alone to enhance productivity compared to non-exporting firms. In contrast, firms that export outside Africa alone, but do not use imported inputs in the production process have lower productivity compared to non-exporting firms. Policies that promote trade in intermediate inputs across borders can help to enhance productivity.