TRADE POLICY AND MARKET POWER: FIRM‐LEVEL EVIDENCE

Alan Asprilla, Nicolas Berman (), Olivier Cadot and Melise Jaud ()

International Economic Review, 2019, vol. 60, issue 4, 1647-1673

Abstract: This article identifies the effect of trade policy on market power through new data and a new identification strategy. We identify market power by observing how exporting firms price discriminate across markets following variations in bilateral exchange rates. Pricing‐to‐market is prevalent in all countries in our sample, even among small firms, although it is increasing in firm size. More importantly, we find that the effect of nontariff measures (NTMs) is not isomorphic to that of tariffs. Whereas tariffs reduce the market power of foreign firms through rent‐shifting effects, NTMs reinforce the market power of nonexiting firms, domestic and foreign alike.

Date: 2019
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Citations: View citations in EconPapers (14)

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https://doi.org/10.1111/iere.12409

Related works:
Working Paper: Trade Policy and Market Power: Firm-Level Evidence (2019)
Working Paper: Trade Policy and Market Power: Firm-Level Evidence (2019)
Working Paper: Trade Policy and Market Power: Firm-level Evidence (2018)
Working Paper: Trade Policy and Market Power: Firm-level Evidence (2018)
Working Paper: Trade Policy and Market Power: Firm-level Evidence (2016)
Working Paper: Trade Policy and Market Power: Firm-level Evidence (2016)
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