Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/307328 
Year of Publication: 
2024
Series/Report no.: 
CESifo Working Paper No. 11398
Publisher: 
CESifo GmbH, Munich
Abstract: 
Which products are potentially produced together? When demand for a product increases, which firms will supply it? Using multi-product production patterns within and across firms, we recover a continuous cost-based distance between firms and unproduced products. Higher product distance implies decreasing adoption frequency. When export demand induces domestic product adoption, closer firms provide this supply. Potential costs imply measures of Revenue and Competition Potential. These predict firm sales and scope growth. If all firms produced all products linked by co-production, consumer welfare could increase by 16-30% under constant markups, rising to 46-86% under variable markups.
Subjects: 
multi-product firms
firm capabilities
product classification
product space
growth paths
JEL: 
F10
D20
L10
L23
L25
Document Type: 
Working Paper
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