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Export Destinations and Input Prices

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  • Paulo Bastos
  • Joana Silva
  • Eric Verhoogen

Abstract

This paper examines the extent to which the destination of exports matters for the input prices paid by firms, using detailed customs and firm-product-level data from Portugal. We use exchange-rate movements as a source of variation in export destinations and find that exporting to richer countries leads firms to charge more for outputs and pay higher prices for inputs, other things equal. The results are supportive of the hypothesis that an exogenous increase in average destination income leads firms to raise the average quality of goods they produce and to purchase higher-quality inputs.

Suggested Citation

  • Paulo Bastos & Joana Silva & Eric Verhoogen, 2014. "Export Destinations and Input Prices," NBER Working Papers 20143, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:20143
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    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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