Skip to main content
Log in

Relative export prices and firm size in imperfect markets

  • Published:
Open Economies Review Aims and scope Submit manuscript

Abstract

This paper contributes to the rising field in international trade and industrial organization. A vast sample of Italian micro data is used to study the behavior of relative export prices in imperfect markets. It is shown that relative export prices, the relation of prices a firm charges on export and domestic markets, are, in general, downward biased. Moreover, relative export prices depend negatively on firm size and market concentration, but positively on the average export share of the industry. This indicates that markets are segmented and firms are able to discriminate prices.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Similar content being viewed by others

References

  • Aldrich, J. H. and F. D. Nelson (1984)Linear Probability, Logit, and Probit Models Beverly Hills: Sage University Press.

    Google Scholar 

  • Chizzolini, B., M. Nerlove, L. Pupillo and D. R. Ross (1987) “Price and Production Adjustments of British and Italian Industrial Firms,” mimeo, Philadelphia.

  • Glejser, H., A. Jacquemin and J. Petit (1980) “Exports in an Imperfect Competition Framework: An Analysis of 1,446 Exporters,”Quarterly Journal of Economics 94, pp. 507–524.

    Google Scholar 

  • Helpman, E. and P. R. Krugman (1982)Market Strucrure and Foreign Trade. Cambridge, Mass: MIT Press.

    Google Scholar 

  • Jacquemin, A. (1982) “Imperfect Market Structure and International Trade — Some Recent Research,”Kyklos 35, pp. 75–93.

    Google Scholar 

  • Jacquemin, A., E. de Ghellinck and C. Huveneers (1980) “Concentration and Profitability in a Small Open Economy,”Journal of Industrial Economics 29, pp. 131–144.

    Google Scholar 

  • Kawasaki, S., J. McMillan and K. F. Zimmermann (1983) “Inventories and Price Inflexibility,”Econometrica 51, pp. 599–610.

    Google Scholar 

  • König, H., M. Nerlove and G. Oudiz (1981) “On the Formation of Price Expectations: An Analysis of Business Test Data by Log-Linear Probability Models,”European Economic Review 16, pp. 103–138.

    Google Scholar 

  • König, H. and K. F. Zimmermann (1986) “Innovations, Market Structure and Market Dynamics,”Journal of Institutional and Theoretical Economics 142, pp. 184–199.

    Google Scholar 

  • McKelvey, R. and W. Zavoina (1975) “A Statistical Model for the Analysis of Ordinal Level Dependent Variables,”Journal of Mathematical Sociology 4, pp. 103–120.

    Google Scholar 

  • Nerlove, M. (1983) “Expectations, Plans, and Realizations in Theory and Practice,”Econometrica 51, pp. 1257–1279.

    Google Scholar 

  • Nerlove, M., B. Chizzolini and L. Pupillo (1985) “Demand Expectations, Production Plans, Prices and Inventories”, mimeo, Philadelphia.

  • Pagoulatos, E. and R. Sorensen (1986) “What Determines the Elasticity of Industry Demand?”International Journal of Industrial Organization 4, pp. 237–250.

    Google Scholar 

  • Ross, T. W. (1988) “On the Price Effects of Mergers with Freer Trade,”International Journal of Industrial Organization 6, pp. 233–246.

    Google Scholar 

  • Veall, M. and K. F. Zimmermann (1991) “Pseudo-R2's in the Ordinal Probit Model,” forthcomingJournal of Mathematical Sociology.

  • Venables, A. J. (1985) “International Trade, Trade and Industrial Policy and Imperfect Competition: A Survey,” CEPR—Discussion Paper, London.

  • Zimmermann, K. F. (1987) “Trade and Dynamic Efficiency,”Kyklos 40, pp. 73–87.

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Rights and permissions

Reprints and permissions

About this article

Cite this article

Pupillo, L., Zimmermann, K.F. Relative export prices and firm size in imperfect markets. Open Econ Rev 2, 295–304 (1991). https://doi.org/10.1007/BF01886147

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF01886147

Key words

Navigation