Export behavior of Italian food firms: Does product quality matter?

Daniele Curzi and Alessandro Olper

Food Policy, 2012, vol. 37, issue 5, 493-503

Abstract: Using firm-level data we investigate the export behavior of Italian food firms, focusing on the link between total factor productivity (TFP), product quality, and export across heterogeneous destinations. We test the main predictions of an international trade model based on firm heterogeneity in product quality and non-homothetic preferences in consumption. In this setting, the firm’s export intensity should be increasing in the per-capita income of foreign destinations, and the effect should be largely driven by firms’ heterogeneity in product quality. Using different measures of revenue-TFP, and different proxies for product quality, we find strong support for the main model predictions. Moreover, consistent with the Alchian–Allen effect, we find a positive relationship between the quality of exported products and the distance of destination countries.

Keywords: Firms heterogeneity; Total factor productivity; Quality; Export behavior; Food industry (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (60)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfpoli:v:37:y:2012:i:5:p:493-503

DOI: 10.1016/j.foodpol.2012.05.004

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