The impact of imports on price-cost margins: An empirical illustration

Rigoberto Lopez and Elena Lopez

Empirical Economics, 2003, vol. 28, issue 2, 403-416

Abstract: This article decomposes the impact of imports on domestic price-cost margins into separate price and cost effects. Using data from 24 food-processing industries, the empirical results show that although the direct impact of imports on prices is always negative, a positive net impact on price-cost margins occurs in industries characterized by low own-price elasticity of demand and diseconomies of scale. Further results show that the disciplining effect of imports is more preponderant the lower the degree of domestic competition. Copyright Springer-Verlag Berlin Heidelberg 2003

Keywords: Key words: Market power; imports; market structure; international trade; food industry.; JEL classification: F120 (search for similar items in EconPapers)
Date: 2003
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Working Paper: The Impact of Imports on Price-Cost Margins: An Empirical Illustration (2001)
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DOI: 10.1007/s001810200138

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