Download or read book Heterogeneous Firms and Import Quality written by Benjamin R. Mandel and published by DIANE Publishing. This book was released on 2010-11 with total page 49 pages. Available in PDF, EPUB and Kindle. Book excerpt: A key emerging insight in international econ. is that the scope for quality differentiation can help to explain patterns in export prices at the level of products or firms. In this paper, a unified theoretical framework of firm heterogeneity in cost and quality is brought to bear on an expansive data set of U.S. import transaction prices. The higher moments of the price distribution are used to identify the scope for quality differentiation at the detailed product level. The product classification is then used to evaluate two claims in the nascent firm-level trade quality lit. First, the positive link between exporter capability and price is found to depend on the nature of the product. Second, a time series test documents firm sorting into export markets according to output quality. Illus.

Download or read book Essays on firm heterogeneity and quality in international trade written by Eddy Bekkers and published by Rozenberg Publishers. This book was released on 2008 with total page 144 pages. Available in PDF, EPUB and Kindle. Book excerpt: The thesis is organized as follows. Chapter 2 contains a survey of the three most in‡fluential models on fi…rm heterogeneity and of the most important empirical work on firrm heterogeneity. The chapter starts with a brief review of the homogeneous productivity imperfect competition literature. Chapter 2 …finishes with a comparison of the three most in‡fluential models of fi…rm heterogeneity and the oligopoly model put forward in the thesis. Chapter 3 addresses exporting uncertainty under heterogeneous popularity. Chapter 4 contains the chapter on …firm heterogeneity under oligopoly. Chapter 5 constitutes the models on …firm heterogeneity and endogenous quality. Chapter 6 points out the within-sector specialization model. Chapter 7 addresses the effect of importer characteristics on unit values and the role of markups and quality to explain this effect. Chapter 8 concludes.

Download or read book Heterogeneous Quality Firms And Trade Costs written by Matthias Helble and published by . This book was released on 2008 with total page 82 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Comparative Advantage and Heterogeneous Firms written by Andrew B. Bernard and published by . This book was released on 2006 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines how country, industry and firm characteristics interact in general equilibrium to determine nations' responses to trade liberalization. When firms possess heterogeneous productivity, countries differ in relative factor abundance and industries vary in factor intensity, falling trade costs induce reallocations of resources both within and across industries and countries. These reallocations generate substantial job turnover in all sectors, spur relatively more creative destruction in comparative advantage industries than comparative disadvantage industries, and magnify ex ante comparative advantage to create additional welfare gains from trade. The relative ascendance of high-productivity firms within industries boosts aggregate productivity and drives down consumer prices. In contrast with the neoclassical model, these price declines dampen and can even reverse the real wage losses of scarce factors as countries liberalize.

Download or read book Heterogeneous Quality Firms and Trade Costs written by Matthias Helble and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: There is increasing empirical evidence that vertical product differentiation is an important determinant of international trade. However, the economic literature so far has solely focused on the case in which quality trade stems from differences between countries. No studies investigate the role of quality trade between similar economies. This paper first develops a simple theoretical trade model that includes vertical product differentiation in a heterogeneous-firm framework. The model yields three main predictions for trade between similar economies. First, exported goods are of higher quality than goods sold on the domestic market. Second, larger economies have on average higher export qualities compared with smaller economies. Third, with increasing trade costs higher quality goods are exchanged. For all three effects, strong empirical support is found using detailed export trade data of the United States and 15 European Union countries.

Download or read book Product Quality and Firm Heterogeneity in International Trade written by Antoine Gervais and published by . This book was released on 2013 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: I develop and implement a methodology for obtaining plant-level estimates of product quality from revenue and physical output data. Intuitively, firms that sell large quantities of output conditional on price are classified as high quality producers. I use this method to decompose cross-plant variation in price and export status into a quality and an efficiency margin. The empirical results show that prices are increasing in quality and decreasing in efficiency. However, selection into exporting is driven mainly by quality. The finding that changes in quality and efficiency have different impact on the firm's export decision is shown to be inconsistent with the traditional iceberg trade cost formulation and points to the importance of per unit transport costs.

Download or read book Quality Heterogeneity Across Firms and Export Destinations written by and published by . This book was released on 2009 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: This paper establishes six new stylized facts about firms' export prices using recently-released customs data on the universe of Chinese trade flows. First, firms that charge higher export prices earn greater revenues in each destination, have bigger worldwide sales, and export to more markets. Second, firms that export more, that sell to more destinations and that charge higher export prices use more expensive imported inputs. Third, firms set higher prices in larger, richer, bilaterally more distant and overall less remote destinations. Fourth, firms earn greater revenues in markets where they set higher prices. Fifth, firms that export to more destinations offer a wider range of export prices. Finally, firms that export more, that sell to more markets and that offer a wider range of export prices pay a wider range of imported-input prices and source inputs from more origin countries. We propose that trade models should incorporate two features to rationalize these patterns in the data: more successful exporters use higher-quality inputs to produce higher-quality goods (stylized facts 1 and 2), and firms vary the quality of their products across destinations by using inputs of different quality levels (stylized facts 3, 4, 5 and 6).

Download or read book What is Firm Heterogeneity in Trade Models written by Colin Hottman and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: We estimate a structural model of heterogeneous multiproduct firms to examine the sources of firm heterogeneity emphasized in the recent trade and macro literatures. Using Nielsen barcode data on prices and sales, we estimate elasticities of substitution within and between firms, and use the estimated model to recover unobserved qualities, marginal costs and markups. We find that variation in firm quality and product scope explains at least four fifths of the variation in firm sales. Most firms are well approximated by the monopolistic competition benchmark of constant markups, but the largest firms that account for most of aggregate sales depart substantially from this benchmark. Although the output of multiproduct firms is differentiated, cannibalization is quantitatively important for the largest firms. This imperfect substitutability of products within firms, and the fact that larger firms supply more products than smaller firms, implies that standard productivity measures are not independent of demand system assumptions and probably dramatically understate the relative productivity of the largest firms.

Download or read book Firm Heterogeneity Endogenous Quality and Traded Goods Prices written by Eddy Bekkers and published by . This book was released on 2016 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: A model with endogenous quality and firm heterogeneity is developed. Firms can invest in quality, and quality investment is relatively skill intensive. The model is used to account for two findings in the empirical literature on traded goods prices, lacking a formal explanation in the theoretical literature thus far. First, the model provides a theoretical explanation for Schott's (Quarterly Journal of Economics 2004, 119, 647) empirical finding that relatively skill-abundant countries export higher priced goods. Firms in these countries invest more in quality and therefore sell higher quality, higher priced goods. Second, the opposite effects of importer market size on traded goods prices at the firm level (positive) and at the aggregate level (negative) identified in the empirical literature can be explained with the model. In a larger market, the incentive to invest in quality is larger for each firm, leading to higher firm-level prices. Due to a selection effect, also less productive firms selling goods of lower quality can export to larger markets, implying lower aggregate prices.

Download or read book Firms exporting behavior under quality constraints written by Juan Carlos Hallak and published by . This book was released on 2009 with total page 63 pages. Available in PDF, EPUB and Kindle. Book excerpt: We develop a model of international trade with export quality requirements and two dimensions of firm heterogeneity. In addition to "productivity", firms are also heterogeneous in their "caliber"--The ability to produce quality using fewer fixed inputs. Compared to single-attribute models of firm heterogeneity emphasizing either productivity or the ability to produce quality, our model provides a more nuanced characterization of firms' exporting behavior. In particular, it explains the empirical fact that firm size is not monotonically related with export status: there are small firms that export and large firms that only operate in the domestic market. The model also delivers novel testable predictions. Conditional on size, exporters are predicted to sell products of higher quality and at higher prices, pay higher wages and use capital more intensively. These predictions, although apparently intuitive, cannot be derived from single-attribute models of firm heterogeneity as they imply no variation in export status after size is controlled for. We find strong support for the predictions of our model in manufacturing establishment datasets for India, the U.S., Chile, and Colombia.

Download or read book Firms and Economic Performance written by Alessandra Bonfiglioli and published by . This book was released on 2018 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: We use transaction-level US import data to compare firms from virtually all countries in the world competing in a single destination market. Guided by a simple theoretical framework, we decompose countries' market shares into the contribution of the number of firm-products, their average attributes (quality and efficiency) and heterogeneity around the mean. Our results show that the number of firm-products explains half of the variation in sales, while the remaining part is equally accounted for by average attributes and their dispersion. Quality is the main driver of firm heterogeneity (explaining between 75% and 100%). We then study how the distribution of firm-level characteristics varies across countries, and we explore some of its determinants. Countries with a larger market size tend to be characterized by a more dispersed distribution of firms' sales, especially due to heterogeneity in quality. These countries also tend to be more likely to host superstar firms, although this is not the only source of higher heterogeneity. To further explore the role of exceptional firms, we develop a novel decomposition that separates the contribution of heterogeneity from that of granularity. While individual firms matter, we find that heterogeneity is more important than granularity for explaining sales.

Download or read book Firm Size Quality Bias and Import Demand written by Joaquin Blaum and published by . This book was released on 2019 with total page 64 pages. Available in PDF, EPUB and Kindle. Book excerpt: Commonly used firm-based models of importing imply that firm productivity should have no effect on the allocation of expenditure across a common set of sourcing countries. Using French data, we show that this homotheticity property is soundly rejected: larger firms concentrate their import spending on their top varieties, holding the sourcing strategy fixed. To rationalize this finding, we propose a novel model of importing that features (i) a complementarity between firm productivity and input quality and (ii) heterogeneity across countries in their ability to produce high quality inputs. This model implies that large firms bias their spending towards countries with a comparative advantage in producing high quality inputs and hence generates a non-homothetic import demand system. We provide empirical support for this and other predictions of this theory.

Download or read book Export prices and heterogeneous firm models written by Kalina Manova and published by . This book was released on 2009 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the variation in export prices across firms, products and destinations to distinguish between alternative heterogeneous firm models of international trade. We establish five stylized facts using new data on the universe of Chinese trading firms. First, firms charging higher export prices earn larger revenues within each destination, have greater worldwide sales, and export to more markets. Second, firms that pay higher import prices set higher export prices, have greater worldwide sales, and export to more markets. Third, firms offer higher prices in larger, richer and more distant markets. Fourth, there is a positive correlation between export price and revenue across destinations within a firm. Finally, firms that export more to more countries pay a wider range of import prices and offer a broader menu of export prices. None of the heterogeneous firm models in the literature can match all of these patterns. Our results are instead consistent with quality differentiation across firms (stylized facts 1 and 2) and firms adjusting both quality and mark-ups across destinations in response to market toughness (stylized facts 3, 4 and 5).

Download or read book Comparative Advantage and Quality with Heterogeneous Firms written by Dongzhe Zhang and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Import Competition Heterogeneous Preferences of Managers and Productivity written by Cheng Chen and published by . This book was released on 2019 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: Empirical evidence on the relationship between import competition and firm productivity is mixed. We explore a new dimension of firm heterogeneity by focusing on different types of managers. Using Spanish firm-level data, we show that import competition leads to productivity increases for family-managed firms that are initially unproductive. Productivity changes are driven by family management as opposed to family ownership or non-managing family members. This evidence is consistent with a model in which family managers care more about the survival of their firm than professional managers, which triggers additional effort when the firm is faced with an increased bankruptcy risk. We show evidence consistent with this mechanism.

Download or read book Quality Selection Sectoral Heterogeneity and Chinese Exports written by Richard Kneller and published by . This book was released on 2016 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent models of international trade have identified product quality as an important determinant of bilateral trade flows. In this paper we examine the relationship between the characteristics of the export market and the aggregate quality of products using Chinese data. We find evidence that product unit values vary with standard gravity variables in a different manner across sectors of the Chinese economy and run contrary to earlier findings for the USA. These results are not compatible with existing heterogeneous firm trade models with constant mark-up and the extension to include product quality. We construct a heterogeneous firm trade model with quality differences and spatial price discrimination, and show that the model provides plausible explanations for our empirical finds as well as other existing findings in the literature.

Download or read book Whats is Firm Heterogeneity in Trade Models written by Colin Hottman and published by . This book was released on 2014 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt: