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High-end variety exporters defying distance: micro facts and macroeconomic implications

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  • MARTIN, Julien

    () (Department of Economics, Université du Québec à Montréal)

  • MAYNERIS , Florian

    () (Université catholique de Louvain, IRES & CORE, Belgium)

  • ,

Abstract

We develop a new methodology to identify high-end variety exporters in French firm- level data. We show that they do not export to many more countries, but they export to more distant ones. This comes with a greater geographic diversification of their aggregate exports. These facts are explained by a lower sensitivity to distance of high-end variety export(er)s. We also show that high-end export(er)s are more sensitive to the average income of the destination country. Because of this different sensitivity to gravity variables, the within-product specialization of a country in the production of high-end varieties is likely to affect its export growth and volatility. We show that a higher sensitivity to per capita income tends to increase the volatility of high-end variety exports. However, a lower sensitivity to distance reduces volatility through a greater geographic diversification. Furthermore, we point out that a lower sensitivity to distance allows high-end varieties to benefit more from growth in more distant markets.

Suggested Citation

  • MARTIN, Julien & MAYNERIS , Florian & ,, 2013. "High-end variety exporters defying distance: micro facts and macroeconomic implications," LIDAM Discussion Papers CORE 2013061, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvco:2013061
    as

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    References listed on IDEAS

    as
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    Cited by:

    1. Bastos, Paulo & Silva, Joana, 2010. "The quality of a firm's exports: Where you export to matters," Journal of International Economics, Elsevier, vol. 82(2), pages 99-111, November.
    2. Anna Ray & Antoine Vatan, 2013. "Demand for Luxury Goods in a World of Income Disparities," PSE - G-MOND WORKING PAPERS hal-00959398, HAL.
    3. Lionel Fontagné & Sophie Hatte, 2013. "European High-End Products in International Competition," PSE - G-MOND WORKING PAPERS hal-00959394, HAL.
    4. Ciani, Andrea & Bartoli, Francesca, 2015. "Export quality upgrading under credit constraints," DICE Discussion Papers 191, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    5. Stefaan Decramer & Catherine Fuss & Jozef Konings, 2016. "How Do Exporters React to Changes in Cost Competitiveness?," The World Economy, Wiley Blackwell, vol. 39(10), pages 1558-1583, October.
    6. Lionel Fontagné & Sophie Hatte, 2014. "European High-End Varieties in International Competition," Working Papers 2014-27, CEPII research center.
    7. Reza Tajaddini & Hassan F. Gholipour, 2018. "Control of Corruption and Luxury Goods Consumption," Kyklos, Wiley Blackwell, vol. 71(4), pages 613-641, November.
    8. Anna Ray & Antoine Vatan, 2013. "Demand for Luxury Goods in a World of Income Disparities," Working Papers hal-00959398, HAL.
    9. Flora Bellone & Patrick Musso & Lionel Nesta & Frederic Warzynski, 2016. "International trade and firm-level markups when location and quality matter," Journal of Economic Geography, Oxford University Press, vol. 16(1), pages 67-91.
    10. Anna Ray & Antoine Vatan, 2013. "Demand for Luxury Goods in a World of Income Disparities," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00959398, HAL.

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    More about this item

    Keywords

    gravity; distance; firm-level data; growth; volatility;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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