{
  "title": "Commodity Booms, Productivity, and Misallocation: Evidence from Chile’s Administrative Data",
  "publication": "IMF Working Papers, July 31, 2026",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2026/07/31/commodity-booms-productivity-and-misallocation-evidence-from-chiles-administrative-data-578232",
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  "summary": "We study how commodity booms affect productivity using administrative microdata from Chile combining firm exports by product and destination, employer-employee records, and firm-to-firm production networks.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Study uses administrative microdata from Chile combining firm exports by product and destination, employer-employee records, and firm-to-firm production networks.\n- Exploits differential Chinese demand across Chilean commodity products to measure firms’ exposure to the commodity boom and trace effects on productivity and resource allocation.\n- Develops a model with heterogeneous export wedges and labor market frictions to assess how commodity booms affect sectoral productivity and input misallocation.\n- Calibrated to Chile, the model mechanism explains half of the mining TFP decline from 2005 to 2013.\n- Publication details: Pages: 74; Volume: 2026; Issue: 163; Series: Working Paper No. 2026/163; DOI: https://doi.org/10.5089/9798229055529.001; Stock No: WPIEA2026163; ISBN: 9798229055529; ISSN: 1018-5941."
    },
    {
      "heading": "Key findings",
      "content": "- More exposed firms experience larger revenue increases but no differential productivity gains, and they channel revenues into wages and materials.\n- Among exposed firms:\n  - Low-productivity firms expand employment.\n  - High-productivity firms do not expand employment.\n  - Employment expansion by low-productivity firms involves hiring workers from more productive employers.\n- Domestic suppliers with greater indirect exposure show larger sales and productivity gains.\n- Aggregate and firm-level evidence are consistent with a mechanism in which commodity booms can reduce sectoral productivity by exacerbating input misallocation.\n- Calibrated quantitative result: the mechanism explains half of the mining total factor productivity (TFP) decline from 2005 to 2013."
    },
    {
      "heading": "Mechanisms identified",
      "content": "- Revenue channel:\n  - Differential exposure to Chinese demand raises revenues for more exposed firms.\n  - Revenue increases are not accompanied by corresponding productivity gains.\n  - Additional revenues are allocated to wages and materials.\n- Labor reallocation channel:\n  - Labor moves from more productive to less productive employers within exposed firms.\n  - Low-productivity exposed firms expand employment by hiring away workers from higher-productivity firms, reducing effective productivity.\n- Input-supplier channel:\n  - Domestic suppliers with higher indirect exposure to the boom increase sales and experience productivity gains, reflecting networked transmission of demand shocks.\n- General equilibrium effect:\n  - Heterogeneous export wedges combined with labor market frictions generate input misallocation that can lower sectoral productivity during commodity booms."
    },
    {
      "heading": "Model and calibration",
      "content": "- Model features: heterogeneous export wedges; labor market frictions; firm-level heterogeneity; input linkages across firms.\n- Calibration to Chilean data yields a quantitative accounting result: the model’s misallocation mechanism accounts for half of the observed mining sector TFP decline over 2005–2013."
    },
    {
      "heading": "Implications for analysis and policy discussion",
      "content": "- Commodity booms can have heterogeneous micro-level effects that do not automatically translate into productivity gains at the firm or sector level.\n- Revenue windfalls concentrated in exposed firms may lead to resource reallocation toward less productive uses when labor market frictions and input linkages are present.\n- Evaluations of commodity booms should account for indirect exposure through supplier networks and potential adverse reallocation effects on sectoral TFP.\n- Policy responses aiming to preserve or enhance sectoral productivity during commodity booms may need to address:\n  - Labor market frictions that enable inefficient hiring away from higher-productivity firms.\n  - Input misallocation arising from differential export wedges and network linkages."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subject: Commodities, Commodity booms, Exports, International trade, Labor, Labor market frictions, Labor markets, Production, Productivity\n- Keywords: commodity boom, Commodity booms, Employment, Exports, Global, IMF working papers, input misallocation, Labor market frictions, Labor markets, Labor reallocation., Micro-level Data, Mining sector, Misallocation, Productivity, productivity gain, sectoral productivity, Total factor productivity, Wages\n\nIMF Working Papers: \"Commodity Booms, Productivity, and Misallocation: Evidence from Chile’s Administrative Data\", Pablo Filippi, Ryan Kim, Nan Li, María Jesús Pérez, Younghun Shim, July 31, 2026.\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2026/07/31/commodity-booms-productivity-and-misallocation-evidence-from-chiles-administrative-data-578232"
    }
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    "Authors: Pablo Filippi, Ryan Kim, Nan Li, María Jesús Pérez, Younghun Shim",
    "Published: July 31, 2026",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229055529.001",
    "Study uses administrative microdata from Chile combining firm exports by product and destination, employer-employee records, and firm-to-firm production networks.",
    "Exploits differential Chinese demand across Chilean commodity products to measure firms’ exposure to the commodity boom and trace effects on productivity and resource allocation.",
    "Develops a model with heterogeneous export wedges and labor market frictions to assess how commodity booms affect sectoral productivity and input misallocation.",
    "Calibrated to Chile, the model mechanism explains half of the mining TFP decline from 2005 to 2013.",
    "Publication details: Pages: 74; Volume: 2026; Issue: 163; Series: Working Paper No. 2026/163; DOI: https://doi.org/10.5089/9798229055529.001; Stock No: WPIEA2026163; ISBN: 9798229055529; ISSN: 1018-5941.",
    "More exposed firms experience larger revenue increases but no differential productivity gains, and they channel revenues into wages and materials.",
    "Among exposed firms:",
    "Domestic suppliers with greater indirect exposure show larger sales and productivity gains.",
    "Aggregate and firm-level evidence are consistent with a mechanism in which commodity booms can reduce sectoral productivity by exacerbating input misallocation.",
    "Calibrated quantitative result: the mechanism explains half of the mining total factor productivity (TFP) decline from 2005 to 2013.",
    "Revenue channel:",
    "Labor reallocation channel:",
    "Input-supplier channel:",
    "General equilibrium effect:",
    "Model features: heterogeneous export wedges; labor market frictions; firm-level heterogeneity; input linkages across firms.",
    "Calibration to Chilean data yields a quantitative accounting result: the model’s misallocation mechanism accounts for half of the observed mining sector TFP decline over 2005–2013.",
    "Commodity booms can have heterogeneous micro-level effects that do not automatically translate into productivity gains at the firm or sector level.",
    "Revenue windfalls concentrated in exposed firms may lead to resource reallocation toward less productive uses when labor market frictions and input linkages are present.",
    "Evaluations of commodity booms should account for indirect exposure through supplier networks and potential adverse reallocation effects on sectoral TFP.",
    "Policy responses aiming to preserve or enhance sectoral productivity during commodity booms may need to address:",
    "Subject: Commodities, Commodity booms, Exports, International trade, Labor, Labor market frictions, Labor markets, Production, Productivity",
    "Keywords: commodity boom, Commodity booms, Employment, Exports, Global, IMF working papers, input misallocation, Labor market frictions, Labor markets, Labor reallocation., Micro-level Data, Mining sector, Misallocation, Productivity, productivity gain, sectoral productivity, Total factor productivity, Wages",
    "**Working Paper**"
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