Mayer, Thierry, Melitz, Marc and Ottaviano, Gianmarco I. P. (2014) Market size, competition, and the product mix of exporters. American Economic Review, 104 (2). pp. 495-536. ISSN 0002-8282
We build a theoretical model of multi-product firms that highlights how competition across market destinations affects both a firm's exported product range and product mix. We show how tougher competition in an export market induces a firm to skew its export sales toward its best performing products. We find very strong confirmation of this competitive effect for French exporters across export market destinations. Theoretically, this within-firm change in product mix driven by the trading environment has important repercussions on firm productivity. A calibrated fit to our theoretical model reveals that these productivity effects are potentially quite large.
Actions (login required)
|Record administration - authorised staff only|