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Price discrimination within and across EMU markets: Evidence from French exporters

Author

Listed:
  • Francois Fontaine

    (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Julien Martin

    (UQAM - Université du Québec à Montréal = University of Québec in Montréal)

  • Isabelle Méjean

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - CNRS - Centre National de la Recherche Scientifique - X - École polytechnique - ENSAE ParisTech - École Nationale de la Statistique et de l'Administration Économique)

Abstract

We study the cross-sectional dispersion of prices paid by EMU importers for French products. We document a significant level of dispersion in unit values both within product categories across exporters, and within exporters across buyers. This latter source of price discrepancies, which we call price discrimination, reflects the ability of exporters to sell similar or differentiated varieties of a given product at different prices to different buyers. Price discrimination (i) is substantial within the EU, within the euro area, and within EMU countries; (ii) has not decreased over the last two decades; (iii) is more prevalent among the largest firms and for more differentiated products; (iv) is lower among retailers and wholesalers; (v) is also observed within almost perfectly homogenous product categories, which suggests that a non-negligible share of price discrimination is partly triggered by heterogeneous markups rather than quality or composition effects. We then estimate a rich statistical decomposition of the variance of prices to shed light on exporters' pricing strategies.

Suggested Citation

  • Francois Fontaine & Julien Martin & Isabelle Méjean, 2020. "Price discrimination within and across EMU markets: Evidence from French exporters," PSE-Ecole d'économie de Paris (Postprint) halshs-02492515, HAL.
  • Handle: RePEc:hal:pseptp:halshs-02492515
    DOI: 10.1016/j.jinteco.2020.103300
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-02492515
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance

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