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Price-Cost Margins, Exports and Productivity Growth: With an Application to Canadian Industries

Author

Listed:
  • Jeffrey I. Bernstein
  • Pierre Mohnen

Abstract

A model is estimated for oligopolistic industries producing multiple outputs in short-run equilibrium. Outputs are sold domestically and exported, while capital is treated as a quasi-fixed factor. The model is applied to the Canadian non-electrical machinery, electrical products, and chemical products industries. The results show that there is significant oligopoly power in each of the industries and that the degree of this power differs between the domestic and export markets. Total factor productivity is decomposed. Price-cost margins exert little influence but the rate of technological change, returns to scale, and the rate of capital adjustment determine productivity growth.

Suggested Citation

  • Jeffrey I. Bernstein & Pierre Mohnen, 1991. "Price-Cost Margins, Exports and Productivity Growth: With an Application to Canadian Industries," Canadian Journal of Economics, Canadian Economics Association, vol. 24(3), pages 638-659, August.
    • Handle: RePEc:cje:issued:v:24:y:1991:i:3:p:638-59
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    Cited by:

    1. M. Ishaq Nadiri & Ingmar Prucha, 2001. "Dynamic Factor Demand Models and Productivity Analysis," NBER Chapters, in: New Developments in Productivity Analysis, pages 103-172, National Bureau of Economic Research, Inc.
    2. Mamuneas, Theofanis P., 1999. "Spillovers from publicly financed R&D capital in high-tech industries," International Journal of Industrial Organization, Elsevier, vol. 17(2), pages 215-239, February.
    3. Bernstein, Jeffrey & Shah, Anwar, 1993. "Corporate tax structure and production," Policy Research Working Paper Series 1196, The World Bank.
    4. Thijs ten Raa & Pierre Mohnen, 2009. "Neoclassical Growth Accounting and Frontier Analysis: A Synthesis," World Scientific Book Chapters, in: Input–Output Economics: Theory And Applications Featuring Asian Economies, chapter 19, pages 347-370, World Scientific Publishing Co. Pte. Ltd..
    5. M. Ishaq Nadiri & Banani Nandi, 1996. "The Changing Structure of Cost and Demand for the U.S. Telecommunications Industry," NBER Working Papers 5820, National Bureau of Economic Research, Inc.
    6. Paul Geroski & Tobias Kretschmer & Chris Walters, 2009. "Corporate Productivity Growth: Champions, Leaders, And Laggards," Economic Inquiry, Western Economic Association International, vol. 47(1), pages 1-17, January.
    7. Soete, Luc & Weel, Bas ter, 1999. "Schumpeter and the Knowledge-Based Economy: On Technology and Competition Policy," Research Memorandum 004, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    8. Marcin Pracz & Rod Tyers, 2006. "Strategic Interaction amongst Australia’s East Coast Ports," ANU Working Papers in Economics and Econometrics 2006-471, Australian National University, College of Business and Economics, School of Economics.
    9. Lourdes Moreno & Diego Rodríguez, 2011. "Markups, Bargaining Power and Offshoring: An Empirical Assessment-super-1," The World Economy, Wiley Blackwell, vol. 34(9), pages 1593-1627, September.
    10. Bernstein, Jeffrey I. & Mohnen, Pierre, 1998. "International R&D spillovers between U.S. and Japanese R&D intensive sectors," Journal of International Economics, Elsevier, vol. 44(2), pages 315-338, April.
    11. Jean-Luc Gaffard & Evens Salies (ed.), 2010. "Innovation, Economic Growth and the Firm," Books, Edward Elgar Publishing, number 13101.
    12. Sarah Guillou & Stefano Schiavo, 2009. "Tarification au marché et variation des marges à l’exportation," Sciences Po Economics Publications (main) hal-03459937, HAL.
    13. Bernstein, Jeffrey I., 1992. "Price margins and capital adjustment : Canadian mill products and pulp and paper industries," International Journal of Industrial Organization, Elsevier, vol. 10(3), pages 491-510, September.
    14. Sarah Guillou & Stefano Schiavo, 2010. "Export Prices and Increasing World Competition: Evidence from French, German, and Italian Pricing Behaviour," Chapters, in: Jean-Luc Gaffard & Evens Salies (ed.), Innovation, Economic Growth and the Firm, chapter 10, Edward Elgar Publishing.
    15. repec:spo:wpmain:info:hdl:2441/6123 is not listed on IDEAS
    16. repec:isu:genstf:1997010108000012985 is not listed on IDEAS
    17. repec:spo:wpmain:info:hdl:2441/9708 is not listed on IDEAS
    18. Bruinshoofd, Allard & Hollanders, Hugo & Weel, Bas ter, 1999. "Knowledge Spillovers and Wage Inequality: An Empirical Investigation of Knowledge-Skill Complementarity," Research Memorandum 008, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    19. Jaumandreu, Jordi & Doraszelski, Ulrich, 2019. "Using Cost Minimization to Estimate Markups," CEPR Discussion Papers 14114, Centre for Economic Policy Research.
    20. Soete, Luc & Weel, Bas ter, 1999. "Innovation, Knowledge Creation and Technology Policy in Europe," Research Memorandum 001, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    21. Diego Rodriguez & Lourdes Moreno, 2013. "The effect of international trade on markups distribution," Economics and Business Letters, Oviedo University Press, vol. 2(1), pages 33-41.
    22. Lourdes Moreno Martin & Diego Rodriguez Rodriguez, 2010. "Export activity, persistence and mark-ups," Applied Economics, Taylor & Francis Journals, vol. 42(4), pages 475-488.
    23. Lourdes Moreno & Diego Rodríguez, 2004. "Domestic and Foreign Price/Marginal‐cost Margins: an Application to Spanish Manufacturing Firms," Review of International Economics, Wiley Blackwell, vol. 12(1), pages 60-80, February.
    24. repec:spo:wpecon:info:hdl:2441/6123 is not listed on IDEAS

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