What drives the market share changes? Price versus non-price factors

Konstantins Benkovskis and Julia Wörz

No 18/2013, BOFIT Discussion Papers from Bank of Finland Institute for Emerging Economies (BOFIT)

Abstract: The paper proposes a theoretical framework to explain gains and losses in export market shares by their price and non-price determinants. Starting from a demand-side model à la Armington (1969), we relax several restrictive assumptions to evaluate the contribution of unobservable changes in taste and quality, taking into account differences in elasticities of substitution across product markets. Using highly disaggregated trade data from UN Com-trade, our empirical analysis for the major world exporters (G7 and BRIC countries) reveals the dominant role of non-price factors in explaining the competitive gains of BRIC countries and concurrent decline in the G7's share of world exports.

Keywords: export market share decomposition; non-price competitiveness; real effective exchange rate (search for similar items in EconPapers)
JEL-codes: C43 F12 F14 L15 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: What drives the market share changes? Price versus non-price factors (2018)
Working Paper: What drives the market share changes? price versus non-price factors (2014)
Working Paper: What Drives the Market Share Changes? Price Versus Non-Price Factors (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bofitp:bdp2013_018

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