The Buyer Margins of Firms' Exports

Gianmarco Ottaviano, Christian Volpe Martincus and Jeronimo Carballo

No 9584, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We use highly disaggregated firm-level export data from Costa Rica, Ecuador, and Uruguay over the period 2005-2008 to provide a precise characterization of firms' export margins, across products, destination countries, and crucially customers. We show that a firm's number of buyers and the distribution of sales across them systematically vary with the characteristics of its destination markets. While most firms serve only very few buyers abroad, the number of buyers and the skewness of sales across them increases with the size and the accessibility of destinations. We develop a simple model of selection with heterogeneous buyers and sellers consistent with these findings in which tougher competition induces a better alignment between consumers' ideal variants and firms' core competencies. This generates an additional channel through which tougher competition leads to higher productivity and higher welfare and hints at an additional source of gains from trade as long as freer trade fosters competition.

Keywords: Buyer margins; Competition; Market segmentation; Markups (search for similar items in EconPapers)
JEL-codes: F12 (search for similar items in EconPapers)
Date: 2013-08
New Economics Papers: this item is included in nep-bec and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Related works:
Journal Article: The buyer margins of firms' exports (2018)
Working Paper: The buyer margins of firms' exports (2018)
Working Paper: The buyer margins of firms' exports (2016)
Working Paper: The Buyer Margins of Firms' Exports (2013)
Working Paper: The buyer margins of firms' exports (2013)
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