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Within-Industry Specialization and Global Market Power

  • Ahmad Lashkaripour
American Economic Journal: Microeconomics
vol. 12, no. 1, February 2020
(pp. 75-124)
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Abstract

Export price levels exhibit tremendous cross-national and spatial variation, even within narrowly defined industries. Standard theories attribute this variation to within-industry quality specialization. This paper argues that a significant portion of the export price variation is driven by rich and remote economies specializing in high-market power segments of industries. I also argue that this particular pattern of specialization (i) accounts for 30 percent of the overall gains from trade, and (ii) explains more than 37 percent of the observed cross-national income inequality.

Citation

Lashkaripour, Ahmad. 2020. "Within-Industry Specialization and Global Market Power." American Economic Journal: Microeconomics, 12 (1): 75-124. DOI: 10.1257/mic.20170336

Additional Materials

JEL Classification

  • D43 Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection
  • F12 Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
  • F13 Trade Policy; International Trade Organizations
  • F14 Empirical Studies of Trade
  • L15 Information and Product Quality; Standardization and Compatibility
  • L22 Firm Organization and Market Structure
  • O19 International Linkages to Development; Role of International Organizations
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