Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/110926
Authors: 
Birg, Laura
Voßwinkel, Jan S.
Year of Publication: 
2015
Series/Report no.: 
Discussion Papers, Center for European Governance and Economic Development Research 248
Abstract: 
This paper studies the interaction of a minimum quality standard and exports in a vertical product differentiation model when firms sell global products. If exante quality of foreign firms is lower (higher) than the quality of exporting firms, a mild minimum quality standard in the home market hinders (supports) exports. The minimum quality standard increases quality in both markets. A welfare maximizing minimum quality standard is always lower under trade than under autarky. A Minimum quality standard reduces profits for the exporting firm. It increases domestic welfare, but reduces welfare in the export market.
Subjects: 
minimum quality standard
vertical differentiation
exports
JEL: 
F12
L13
L50
Document Type: 
Working Paper

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