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Distance to destination and export price variation within agri-food firms

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  • Fiankor, Dela-Dem Doe

Abstract

This paper assesses how bilateral distance affects observed spatial variation in free-on-board (FOB) export prices across destinations. I estimate linear models that regress firm-product- destination-time FOB unit values on distance, firm-product-time fixed effects, and destination country controls. I find that if distance doubles the average Swiss agri-food firm increases its FOB export price by 2.3%. My findings show that consumers in distant countries pay higher prices partly because firms charge higher prices net cost-insurance-freight costs. I explain my findings using trade models where firms endogenously choose destination-specific quality for their products.

Suggested Citation

  • Fiankor, Dela-Dem Doe, 2022. "Distance to destination and export price variation within agri-food firms," 96th Annual Conference, April 4-6, 2022, K U Leuven, Belgium 321203, Agricultural Economics Society - AES.
    • Handle: RePEc:ags:aesc22:321203
    DOI: 10.22004/ag.econ.321203
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    Keywords

    Agribusiness; Demand and Price Analysis; International Relations/Trade;
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