Mark-up and Cost Dispersion across Firms: Direct Evidence from Producer Surveys in Pakistan
David Atkin (),
Amit Khandelwal and
Eric Verhoogen ()
No 10366, CEPR Discussion Papers from C.E.P.R. Discussion Papers
Researchers typically invoke theoretical assumptions to estimate mark-ups. Instead, we directly obtain mark-ups by surveying Pakistani soccer-ball producers. We document six facts: (1) Mark-ups are more dispersed than costs; (2) Mark-ups and costs increase with firm size; (3) The mark-up elasticity with respect to size exceeds the cost elasticity; (4) Costs increase with size because larger firms use higher-quality inputs; (5) Larger firms charge higher mark-ups because they have higher production shares of high-quality balls that carry higher mark-ups, and because they charge higher mark-ups conditional on ball type; (6) Correlations suggest marketing efforts are important for generating higher mark-ups.
Keywords: costs; markups; soccer balls (search for similar items in EconPapers)
JEL-codes: F12 L11 O14 (search for similar items in EconPapers)
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Journal Article: Markup and Cost Dispersion across Firms: Direct Evidence from Producer Surveys in Pakistan (2015)
Working Paper: Mark-up and Cost Dispersion across Firms: Direct Evidence from Producer Surveys in Pakistan (2015)
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