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An Empirical Analysis of Mark-ups in the Argentine Manufacturing Sector

Author

Listed:
  • Irene Brambilla
  • Darío Tortarolo

Abstract

In this paper, we estimate mark-ups with plant level production data for Argentina from a structural model of cost-minimizing producers, as proposed by De Loecker and Warzynski (2012). We explore systematic differences across industries and plants. Our main findings are that mark-ups are higher in capital-intensive industries, and for plants that are more productive, larger, and more capital-intensive. Our findings are consistent with theories that predict larger mark-ups for more efficient firms and for higher quality products.

Suggested Citation

  • Irene Brambilla & Darío Tortarolo, 2014. "An Empirical Analysis of Mark-ups in the Argentine Manufacturing Sector," Department of Economics, Working Papers 104, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata.
  • Handle: RePEc:lap:wpaper:104
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    File URL: http://www.depeco.econo.unlp.edu.ar/doctrab/doc104.pdf
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    References listed on IDEAS

    as
    1. Jan De Loecker & Pinelopi K. Goldberg & Amit K. Khandelwal & Nina Pavcnik, 2016. "Prices, Markups, and Trade Reform," Econometrica, Econometric Society, vol. 84, pages 445-510, March.
    2. Kalina Manova & Zhiwei Zhang, 2012. "Export Prices Across Firms and Destinations," The Quarterly Journal of Economics, Oxford University Press, vol. 127(1), pages 379-436.
    3. David Hummels & Alexandre Skiba, 2004. "Shipping the Good Apples Out? An Empirical Confirmation of the Alchian-Allen Conjecture," Journal of Political Economy, University of Chicago Press, vol. 112(6), pages 1384-1402, December.
    4. Timothy Dunne & Mark J. Roberts & Larry Samuelson, 1989. "The Growth and Failure of U. S. Manufacturing Plants," The Quarterly Journal of Economics, Oxford University Press, vol. 104(4), pages 671-698.
    5. Cassiman, Bruno & Vanormelingen, Stijn, 2013. "Profiting from Innovation: Firm Level Evidence on Markups," CEPR Discussion Papers 9703, C.E.P.R. Discussion Papers.
    6. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," Review of Economic Studies, Oxford University Press, vol. 70(2), pages 317-341.
    7. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-670, May.
    8. repec:pri:cepsud:231deloecker is not listed on IDEAS
    9. Ackerberg, Daniel & Caves, Kevin & Frazer, Garth, 2006. "Structural identification of production functions," MPRA Paper 38349, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Mark-ups; Productivity; Argentina.;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L6 - Industrial Organization - - Industry Studies: Manufacturing

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