Holger Görg and Frederic Warzynski Price cost margins ... - DIW Berlin

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Opinions expressed in this paper are those of the author and do not necessarily reflect views of the Institute. DIW Berlin German Institute for Economic Research Königin-Luise-Str. 5 14195 Berlin, Germany Phone +49-30-897 89-0 Fax +49-30-897 89-200 www.diw.de ISSN 1619-4535
Price cost margins and exporting behaviour: Evidence from firm level data ∗ Holger Görg † and Frederic Warzynski ‡ 22 July 2003 Abstract This paper examines whether exporting activity matters for firm’s price cost margins. The recent literature on exporting and productivity shows that exporters on average are more efficient than nonexporters. If that is the case we may also expect them to have different mark-ups. We investigate this issue using company level data for UK manufacturing industries. The measurement of mark-ups follows the recent approach presented by Roeger (1995). Our results show that, on average, exporters have higher mark-ups than non-exporters. We also distinguish sectors into homogeneous and differentiated goods producing. This distinction shows that we only find higher mark-ups for exporters in differentiated goods sectors, not in homogeneous sectors. JEL Classifications: F1, L1, L6 Keywords: exports, mark-ups, price cost margins, productivity ∗ Earlier versions of the paper were presented at Nottingham University, Örebro University and IIIS Dublin. We are particularly grateful to Andrew Bernard, Rod Falvey, Joep Konings, Nannan Lundin, Daniel Mirza, Steve Redding, Andrew Schott and Eric Strobl for helpful comments and discussions. Financial support from the Leverhulme Trust (Grant No. F114/BF) is gratefully acknowledged. † University of Nottingham and DIW Berlin, email holger.gorg@nottingham.ac.uk ‡ IDEI-University of Toulouse, email warzynsk@cict.fr 1
Page 1: Discussion Papers Holger Görg and
Page 5 and 6: tive markets, firms charge a price
Page 7 and 8: which in turn allows one to retriev
Page 9 and 10: sohn, 1993; Konings et al., 2001) a
Page 11 and 12: After these operations our dataset
Page 13 and 14: These estimations, of course, avera
Page 15 and 16: [Table 4 here] However, it may be m
Page 17 and 18: References [1] Basu, S. and Fernald
Page 19 and 20: [23] Krugman, P., 1979. Increasing
Page 21 and 22: Table 3: Exporting premium (1) (2)

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