Verti-zontal differentiation in export markets
Francesco Di Comite,
Jacques Thisse and
Hylke Vandenbussche
Journal of International Economics, 2014, vol. 93, issue 1, 50-66
Abstract:
Many trade models of monopolistic competition identify cost efficiency as the main determinant of firm performance in export markets. To date, the analysis of demand factors has received much less attention. We propose a new model where consumer preferences are asymmetric across varieties and heterogeneous across countries. The model generates new predictions and allows for an identification of horizontal differentiation (taste) clearly distinguished from vertical differentiation (quality). Data patterns observed in Belgian firm–product level exports by destination are congruent with the predictions and seem to warrant a richer modelling of consumer demand.
Keywords: Heterogeneous firms; Heterogeneous consumers; Horizontal differentiation; Vertical differentiation; Asymmetric preferences; Monopolistic competition (search for similar items in EconPapers)
JEL-codes: D43 F12 F14 L16 (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (90)
Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0022199614000130
Full text for ScienceDirect subscribers only
Related works:
Working Paper: Verti-zontal differentiation in export markets (2014)
Working Paper: Verti-zontal differentiation in export markets (2014) 
Working Paper: Verti-zontal differentiation in export markets (2013) 
Working Paper: Verti-zontal differentiation in export markets (2013) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:93:y:2014:i:1:p:50-66
DOI: 10.1016/j.jinteco.2014.01.010
Access Statistics for this article
Journal of International Economics is currently edited by Gourinchas, Pierre-Olivier and RodrÃguez-Clare, Andrés
More articles in Journal of International Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu (repec@elsevier.com).