EconPapers    
Economics at your fingertips  
 

World trade patterns and prices: The role of productivity and quality heterogeneity

Cristiana Benedetti Fasil and Teodora Borota Milicevic

Journal of International Economics, 2013, vol. 91, issue 1, 68-81

Abstract: This paper analyzes the role of product quality and labor efficiency in shaping the trade patterns and trade intensities within and across two groups of countries, the developed and richer North and the developing South. Recent empirical literature identifies two groups of evidence — the product lines evidence on different export strategies and sources of competitiveness across product groups and countries, and the aggregate trade flows evidence on a positive relation between the income per capita and both export and import prices (also conditional on the exporter). We attempt to provide a theoretical background for these findings and focus on the North–South productivity differences in a four country North–South trade model with two dimensions of firm heterogeneity. Differences in the firms' product quality and cost efficiency impose different competitiveness sources when entering more difficult markets and result in the observed export and import prices and consumption bundles across the rich and poor countries.

Keywords: International trade patterns; North–South trade; Import and export prices; Heterogeneous firms; Product quality (search for similar items in EconPapers)
JEL-codes: F10 F12 F14 L11 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 (3) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0022199613000457
Full text for ScienceDirect subscribers only

Related works:
Working Paper: World Trade Patterns and Prices: The Role of Productivity and Quality Heterogeneity (2010) Downloads
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:91:y:2013:i:1:p:68-81

DOI: 10.1016/j.jinteco.2013.04.004

Access Statistics for this article

Journal of International Economics is currently edited by Gourinchas, Pierre-Olivier and Rodríguez-Clare, Andrés

More articles in Journal of International Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2022-10-04
Handle: RePEc:eee:inecon:v:91:y:2013:i:1:p:68-81