Estimating Product Quality in International Trade

Product Quality, Firm Heterogeneity and International Trade∗

I explore variation in price and export status in industries where I can estimate product quality and technical efficiency separately. The empirical results show that prices are increasing in quality and decreasing in efficiency and that selection into exporting is driven mainly by quality. Firms export because they generate more demand for their products, not because they can produce at lower ...

Across-Product versus Within-Product Specialization in International Trade∗

The unit values of US manufacturing imports vary widely within very narrowly defined products. In cross-section, unit values are higher for varieties exported by capital and skill abundant countries, and they increase with the capital intensity of exporters’ production techniques. Over time, the same products increasingly are sourced from more disparate countries. These facts reject ‘old’ trade...

Institutional Quality and International Trade

Institutions — quality of contract enforcement, property rights, shareholder protection, and the like — have received a great deal of attention in recent years. Yet trade theory has not considered the implications of institutional differences, beyond treating them simply as different technologies or taxes. The purpose of this paper is twofold. First, we propose a simple model of international t...

Technical Appendix: Product Quality and Firm Heterogeneity in International Trade (Not For Publication)

A Further Investigation of Product Specialization in International Trade

According to the two empirical observations about U.S. imports, endowments-driven ‘within-product specialization’ has been increasing. From the data analysis, both these observations are shown extending to the imports of Brazil, India and Japan. However, in this paper, our finding is focused on that two factors driving the classical observations. First, China is the dominant low-wage exporter o...