Arbeitspapier
Markups, Quality, and Trade Costs
We investigate theoretically and empirically how exporters adjust their markups across destinations depending on bilateral distance, tariffs, and the quality of their exports. Under the assumption that trade costs are both ad valorem and per unit, our model predicts that markups rise with distance and fall with tariffs, but these effects are heterogeneous and are smaller in magnitude for higher quality exports. We find strong support for the predictions of the model using a unique data set of Argentinean firm-level wine exports combined with experts wine ratings as a measure of quality.
- Language
-
Englisch
- Bibliographic citation
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Series: CESifo Working Paper ; No. 8013
- Classification
-
Wirtschaft
Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
Empirical Studies of Trade
Foreign Exchange
- Subject
-
distance
export unit values
heterogeneity
markups
quality
tariffs
trade costs
wine
- Event
-
Geistige Schöpfung
- (who)
-
Chen, Natalie
Juvenal, Luciana
- Event
-
Veröffentlichung
- (who)
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Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2019
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Chen, Natalie
- Juvenal, Luciana
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2019
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