Multi-product firms at home and away: Cost-versus quality-based competence

• 成果类型: Article
• 署名作者: Eckel, Carsten; Iacovone, Leonardo; Javorcik, Beata; Neary, J. Peter
• 署名单位: University of Munich; The World Bank; University of Oxford; Center for Economic & Policy Research (CEPR)
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2014.12.012
• 发表日期: 2015
• 页码: 216-232
• 关键词: Flexible manufacturing; Investment in product and brand quality; Multi-product firms; Quality competition

摘要

We develop a new model of multi-product firms which invest to improve the perceived quality of both their individual products and their brand. Because of flexible manufacturing, products closer to firms' core competence have lower costs, so firms produce more of them, and also have higher incentives to invest in their quality. These two effects have opposite implications for the profile of prices. Mexican data provide robust confirmation of the model's key prediction: firms in differentiated-good sectors exhibit quality-based competence (prices fall with distance from core competence), but export sales of firms in non-differentiated-good sectors exhibit the opposite pattern. (C) 2014 The Authors. Published by Elsevier B.V.