Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/260026 
Year of Publication: 
2011
Series/Report no.: 
Working Paper No. 2011:37
Publisher: 
Lund University, School of Economics and Management, Department of Economics, Lund
Abstract: 
We analyze empirically product-price variation across export destinations using detailed firm-product data. Most recent studies using highly disaggregated data emphasize variations in product quality as an explanation as to why firms charge different prices for the same product on different export markets. In this paper, we take an alternative approach and assume that variations in firms' export prices reflect market segmentation and investigate the relationship between price variation and average firm markup. We study an entire supply chain in order to see how price discrimination varies across sectors with different distribution networks. Specifically, we make use of firm-level data for exporting firms in the Swedish food supply chain. The results offer new information about the behavior of exporting firms. Hence, for the food-processing industry, firms with greater ability to discriminate between markets are associated with a higher markup. However, the results also reveal that markups are a complex function of firm characteristics and that the price-setting behavior of firms in the manufacturing sector is not necessarily observed in other sectors of the supply chain.
Subjects: 
Markups
Export prices
Price discrimination
Firm-level data
JEL: 
D40
F12
F14
Document Type: 
Working Paper

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