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Journal article
Balázs Muraközy

Markups of Exporters and Importers: Evidence from Hungary

  • Abstract

    This paper studies the relationship between firm markups and importing intermediate inputs and exporting using detailed firm-level data from Hungary in 1995-2003. We estimate production functions structurally to obtain firm-year-level productivity and markup estimates. We find that importing intermediate inputs is associated with large markup premium, while the exporter markup premium is nonexistent when we control for the importer status. We interpret our results in a simple theoretical framework, where firms lower their markup when exporting to more competitive foreign markets and where importing intermediate inputs leads to higher-quality products.
  • Keywords

    markups, exporting, importing, detailed trade data, Hungary
  • JEL classification

    D22, D24, F14, L11, L60
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