The Long and Short (of) Quality Ladders

Khandelwal, Ankur

doi:10.3386/w15178

Cited by 337 publications

(669 citation statements)

References 53 publications

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“…While this outcome in the model is just a result of idiosyncratic shocks, a recent stream of literature on heterogeneous firms has identified a number of factors which can systematically determine it. For instance, different firms may display diversified reactions to international trade shocks, depending upon heterogeneous productivity levels (Melitz 2003;Bernard et al 2003), capital intensity and product-mix (Bernard et al 2006;Khandelwal 2010). Moreover, firms within the same industry are likely to face heterogeneous levels of trade exposure, as documented, among others, by Bernard et al (2007a), Mayer and Ottaviano (2007) and Moser et al (2010).…”

Section: Theoretical Backgroundmentioning

confidence: 99%

Trade openness, real exchange rates and job reallocation: evidence from Belgium

Colantone

2012

Rev World Econ

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This paper investigates the impact of real exchange rate movements on job reallocation at the industry level. The analysis focuses on the manufacturing sector of Belgium, using data for 82 NACE 3-digit industries, over the time span 1996-2002. I find that real exchange rate changes do have a significant impact on job flows, and that this impact is magnified by increasing levels of trade exposure. In particular, a real appreciation is found to lower net employment growth through higher job destruction, while job creation is not significantly affected. These results are in line with previous empirical evidence on the United States, and differ from earlier findings for France and Germany, where the adjustment to real exchange rate shocks has been found to occur mainly through the job creation margin. I suggest that these differences may be explained by the fact that Belgium is a small open economy.

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Section: Theoretical Backgroundmentioning

confidence: 99%

Trade openness, real exchange rates and job reallocation: evidence from Belgium

Colantone

2012

Rev World Econ

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“…Under a supplementary assumption of constant returns to scale in production (i.e., marginal costs not depending on the quantity produced through demand shifters), having a statistically signi…cant relation between marginal costs and g s;t 's con…rms our speci…cation. Having a quality measure di¤erent from unit values is also in line with Khandelwal (2010) who shows that using unit values as a proxy for quality would lead to biased results.…”

Section: Importersmentioning

confidence: 50%

Pass-through of trade costs to U.S. import prices

Yilmazkuday

2015

Rev World Econ

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This paper measures the pass-through of trade costs into U.S. import prices by using actual data on duties/tari¤s and freight-related costs. The key innovation is to decompose the indirect e¤ects of trade costs (on prices) into the e¤ects on markups, quality and productivity while measuring/interpreting the pass-through of trade costs into welfare. Robust to the consideration of variable versus constant markups, there is evidence for incomplete pass-through, mostly due to the negative indirect e¤ects of trade costs on marginal costs, suggesting that lower trade costs are associated with imports that have higher marginal costs; markups are a¤ected relatively less. When the e¤ects of trade costs on marginal costs are further decomposed into their components, the positive contribution of quality dominates in all cases, followed by the negative e¤ects of productivity, suggesting that lower trade costs are associated with higher-quality imports that have been produced with lower productivity. JEL Classi…cation F12, F13, F14

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“…For example, Brambilla, Lederman, and Porto (2012) utilize the concentration of skilled and unskilled workers within a firm. Hallak and Schott (2011), Khandelwal (2010), and Gervais (2012) use the trade balance, import market share and export quantity, respectively, conditional on price and other controls as a measure of quality. In spite of these advances, though, the influence of variable markups on prices is rarely explicitly taken into account.…”

Section: Introductionmentioning

confidence: 99%

Going Global: Markups and Product Quality in the Chinese Art Market

2013

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractWe analyze two reasons for export prices to be different across markets-namely, quality differentiation and variable markups-and attempt to parse their relative importance and some of their underlying drivers. To overcome the substantial measurement issues in this task, we consider a particular industry as a special case: Chinese fine art. The simplicity of the supply side of art vis-á-vis marginal cost and the wealth of data on its quality characteristics make it possible to separately identify the markup and quality components of international relative prices for Chinese artworks. Through this lens, we trace the process of growth and internationalization of Chinese art since the year 2000. We find strong support for quality sorting into international markets at both the level of artist and artwork, as well as substantial markup differences across destinations. Using a structural model of endogenous quality choice by Feenstra and Romalis (2012), we argue that much of the international quality premium is driven by per unit distribution costs (whether physical or informational) rather than destination-specific preferences for quality.

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The Long and Short (of) Quality Ladders

Cited by 337 publications

References 53 publications

Trade openness, real exchange rates and job reallocation: evidence from Belgium

Trade openness, real exchange rates and job reallocation: evidence from Belgium

Pass-through of trade costs to U.S. import prices

Going Global: Markups and Product Quality in the Chinese Art Market

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