Product Quality and Firm Heterogeneity in International Trade

Antoine Gervais

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: I develop and implement a methodology for obtaining plant-level estimates of product quality from revenue and physical output data. Intuitively, firms that sell large quantities of output conditional on price are classified as high quality producers. I use this method to decompose cross-plant variation in price and export status into a quality and an efficiency margin. The empirical results show that prices are increasing in quality and decreasing in efficiency. However, selection into exporting is driven mainly by quality. The finding that changes in quality and efficiency have different impact on the firm's export decision is shown to be inconsistent with the traditional iceberg trade cost formulation and points to the importance of per unit transport costs.

Pages: 34 pages
Date: 2013-03
New Economics Papers: this item is included in nep-bec, nep-com, nep-eff and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (37)

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https://www2.census.gov/ces/wp/2013/CES-WP-13-08.pdf First version, 2013 (application/pdf)

Related works:
Journal Article: Product quality and firm heterogeneity in international trade (2015)
Journal Article: Product quality and firm heterogeneity in international trade (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:13-08

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