Trade Policy and Market Power: Firm-Level Evidence - Aix-Marseille Université Access content directly
Journal Articles International Economic Review Year : 2019

Trade Policy and Market Power: Firm-Level Evidence

Abstract

This article identifies the effect of trade policy on market power through new data and a new identification strategy. We identify market power by observing how exporting firms price discriminate across markets following variations in bilateral exchange rates. Pricing-to-market is prevalent in all countries in our sample, even among small firms, although it is increasing in firm size. More importantly, we find that the effect of nontariff measures (NTMs) is not isomorphic to that of tariffs. Whereas tariffs reduce the market power of foreign firms through rent-shifting effects, NTMs reinforce the market power of nonexiting firms, domestic and foreign alike.

Dates and versions

hal-02394864 , version 1 (05-12-2019)

Identifiers

Cite

Alan Asprilla, Nicolas Berman, Olivier Cadot, Melise Jaud. Trade Policy and Market Power: Firm-Level Evidence. International Economic Review, 2019, 60 (4), pp.1647-1673. ⟨10.1111/iere.12409⟩. ⟨hal-02394864⟩
42 View
0 Download

Altmetric

Share

Gmail Facebook X LinkedIn More