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Title:Why do within firm-product export prices differ across markets? PDF Logo
Authors:Görg, Holger
Halpern, László
Muraközy, Balázs
Issue Date:2010
Series/Report no.:CEPR Discussion Paper Series, Centre for Economic Policy Research (CEPR), London 7708
Abstract:In this paper we analyse the relationship between gravity variables and f.o.b. export unit values using Hungarian firm-product-destination data. By taking firm-product level selection into account we show that export unit values increase with distance even for particular firm-product combinations. This cannot be explained by models assuming firm- or even firm-product level selection and constant markups. The differences are important quantitatively; price differences in Hungarian exports between Germany and the US are about 30%. We also show that unit values are positively related to GDP/capita and that there is a weak negative relationship between unit values and market size. We propose two possible explanations: first, firms may export different quality versions of the same product to different markets. Secondly, directly exporting firms may capture part of the markups on transport costs in their f.o.b. prices.
Subjects:export
Hungary
price
selection
JEL:D40
F12
Document Type:Working Paper
Appears in Collections:Publikationen von Forscherinnen und Forschern des IfW

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