The quality of a firm's exports: Where you export to matters |
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| Institution: | 1. Department of Humanities and Social Sciences, Indian Institute of Technology Kharagpur, India;2. Department of Economics, Jadavpur University, Kolkata 700 032, India;1. University of Virginia, United States;2. NBER, United States;3. University of International Business and Economics, Beijing, China;1. School of Business, Shandong University of Technology, No.88 Gongqingtuan Road, Zibo, Shandong 255012, China;2. Department of Economics, University of Western Ontario, London, Ontario N6A 5C2, Canada;3. NBER, United States;4. The Centre for International Governance Innovation (CIGI), Canada;1. Development Studies Center, Institute of Developing Economies, Japan;2. ISEAS-Yusof Ishak Institute, Singapore;3. Department of Economics, Gakushuin University, Japan;4. Department of Economics, National Central University, Taiwan;1. Brock University, Canada;2. The Pennsylvania State University, United States;3. NYU, United States;4. NBER, United States;5. Tsinghua University, China |
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| Abstract: | What drives export quality? Using Portuguese firm-level data on exports by product and destination market, we find that f.o.b. unit values increase systematically with distance, and tend to be higher in shipments to richer nations. These relationships reflect not only the sorting of firms across markets, but also the within-firm variation of unit values across destinations. Within product categories, higher-productivity firms tend to ship greater quantities at higher prices to a given market, consistent with higher quality. In addition, firm productivity tends to magnify the positive effect of distance on within-product unit values, suggesting that high-productivity, high-quality firms are more able to serve difficult markets. |
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