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

  • MARTIN, Julien

    ()

    (Department of Economics, Université du Québec à Montréal)

  • MAYNERIS , Florian

    ()

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

  • ,

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.

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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2013061.

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Date of creation: 11 Dec 2013
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Handle: RePEc:cor:louvco:2013061
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