Export duration and firm markups: evidence from China

Abstract Against the backdrop of China’s upgrading its openness to outside world, analyzing impact export markets on a firm’s markup—an important indicator pricing power and market power—is great significance for improving international competitiveness benefits global value chain. This study theoretically empirically examines effect duration firm markups using micro data from Chinese manufacturing enterprises. According theoretical study, an increase in will result via “production efficiency” channel but decrease “market-based pricing” channel. Therefore, firms is uncertain. Results empirical analysis reveal that positive higher than negative Overall, has companies’ markups. conclusion valid after series robustness tests. Further reveals different types differs, significant heterogeneity exists. research can help us better understand how fall into “low markup trap” offer fresh insight affect company