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Market size, competition, and the product mix of exporters

Mayer, Thierry, Melitz, Marc J. and Ottaviano, Gianmarco I. P. (2012) Market size, competition, and the product mix of exporters. CEP discussion papers (1146). Centre for Economic Performance, London, UK.

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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 towards 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.

Item Type: Monograph (Discussion Paper)
Official URL:
Additional Information: © 2012 The Authors
Divisions: Economics
Centre for Economic Performance
Subjects: H Social Sciences > HF Commerce
JEL classification: F - International Economics > F0 - General
Date Deposited: 13 Nov 2013 10:36
Last Modified: 25 Jan 2021 13:25
Funders: Economic and Social Research Council

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