Publications

This paper investigates the role of digitalization in improving economic resilience. Using balance sheet data from 24,000 firms in 75 countries, and a difference-in-differences approach, we find that firms in industries that are more digitalized experience lower revenue losses following recessions. Early data since the outbreak of the COVID-19 pandemic suggest an even larger effect during the resulting recessions. These results are robust across a wide range of digitalization measures—such as ICT input and employment shares, robot usage, online sales, intangible assets and digital skills listed on online profiles—and several alternative specifications.

We construct daily databases of crypto bans and policy statements concerning central bank digital currencies (CBDCs) to estimate their effects on crypto trading volumes for an unbalanced panel of 116 countries from November 2016 to December 2021. We find that trading volume falls by up to 55% in the week after the announcement of a ban, and by up to 25% after a CBDC-supportive speech by senior central bank officials. For the strictest bans, this reduction persists over the subsequent quarter, driven by a reduction in trading by institutional investors. The results suggest that crypto market participants pay significant attention to government policy on digital assets.

This paper exploits China’s accession to the WTO to investigate the propagation of a supply shock across the Indian production network. Consistent with a model of multi-product manufacturers gaining access to higher-quality components, a fall in input tariffs raises revenue, quality and prices whilst lowering quality-adjusted prices and the probability of product exit. Upgrading persists for at least ten years; at the peak in 2010, products with a 10% higher pre-accession input tariff, and hence a larger post-accession fall in tariffs, have 5.3% higher quality. This in turn raises quality further down the supply chain, with input-output linkages amplifying the one-step effect by up to 75%. These results highlight a potential beneficial impact of the ‘China shock’ in developing countries, namely supply-driven quality upgrading.

We examine the effects of robotization on developing countries, using a Ricardian framework and new firm-level robotization data from eleven developing countries. We find that robot adoption in advanced economies can benefit workers in developing countries through lower prices and increased demand for inputs – though with potential adverse effects in the transition, particularly for the least mobile workers. Continued Chinese subsidization of robots is likely to reduce China’s trade with OECD countries, while increasing that with developing countries – as China’s profile of comparative advantage increasingly aligns with the former. Larger and more globally-connected firms in developing countries are more likely to adopt robots, as they can afford the fixed costs of upgrading and value the resulting precision more highly. These firms expand post-adoption, increasing the competitive pressure on the smaller, less international firms in which those workers most vulnerable to replacement by robots are also more likely to work.