Markets and Markups: Evidence on the Rising Market Power of Exporters from China

Giancarlo Corsetti, Lu Han, Meredith Crowley and Huasheng Song

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: The Chinese share of global product markets rose sharply over the last quarter century. Using Chinese customs data from 2000–2014, we show that this expansion coincided with a substantial rise in pricing-to-market. Markup elasticities to exchange rates nearly tripled, with more pronounced increases for highly differentiated products, goods with higher import penetration in destination countries, and products sold by larger firms. To identify these patterns, we develop a new estimator of markup elasticities that controls for marginal costs and endogenous market selection and a new classification of product differentiation based on Chinese linguistics.

Keywords: Exchange Rate; Markup Elasticity; Pricing-to-Market; Trade Pattern; Product Classification; Differentiated Goods; China (search for similar items in EconPapers)
JEL-codes: F14 F31 F41 (search for similar items in EconPapers)
Date: 2018-02-13
New Economics Papers: this item is included in nep-cna, nep-opm and nep-tra
Note: gc422, mc865, lh420
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:cam:camdae:1815

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