Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/307350 
Year of Publication: 
2024
Series/Report no.: 
CESifo Working Paper No. 11420
Publisher: 
CESifo GmbH, Munich
Abstract: 
We develop a structural framework that allows us to quantify the evolution of aggregate bilateral trade costs and markups over time. With minimal assumptions, we can disentangle aggregate markup and trade cost changes from observed changes in trade flows. We apply our method to trade data between 1990 and 2015 for the world's 100 largest economies. We find that across all country pairs, on average, bilateral aggregate markups have increased by 2.8% per year. As bilateral trade costs have fallen by 3.1% per year on average, we find a strong negative correlation between observed trade cost and markup changes. Markups have increased less in high-income countries than in other countries.
Subjects: 
markups
trade costs
gravity
imperfect competition
market power
JEL: 
F10
F12
F14
F62
L13
Document Type: 
Working Paper
Appears in Collections:

Files in This Item:
File
Size





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