Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/32948 
Year of Publication: 
2010
Series/Report no.: 
CEPR Discussion Paper Series No. 7708
Publisher: 
Centre for Economic Policy Research (CEPR), London
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

Files in This Item:
File
Size
513.21 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.