Quality Competition Versus Price Competition Goods: An Empirical Classification
AbstractBased on theoretical distinctions suggested by the heterogeneous firms trade model and the quality heterogeneous firms trade model, we classify exports at the HS 6-digit level as being characterised by either quality or price competition. We find a high proportions of quality-competition goods for the major EU countries and lower proportions for Canada, Australia and China. However, the overlap of these quality-competition goods is not large which suggests that the HS-6 digit data is too aggregate; firm-level data may be needed. Our findings suggest that dumping investigations must pay careful attention to the exact definition of products, and the study of technological gaps across nations by analysing composition of their export basket (Hausman, Huang and Rodrik 2007) should be interpreted with caution.
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Bibliographic InfoArticle provided by Center for Economic Integration, Sejong University in its journal Journal of Economic Integration.
Volume (Year): 26 (2011)
Issue (Month): ()
Quality vs Price Competition; Heterogeneous Firms Trade Model;
Other versions of this item:
- Baldwin, Richard & Ito, Tadashi, 2008. "Quality Competition Versus Price Competition Goods: An Empirical Classification," CEPR Discussion Papers 6952, C.E.P.R. Discussion Papers.
- Richard E. Baldwin & Tadashi Ito, 2008. "Quality competition versus price competition goods: An empirical classification," NBER Working Papers 14305, National Bureau of Economic Research, Inc.
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
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