Multi-product firms at home and away: Cost- versus quality-based competence
构建多产品企业模型,研究企业投资提升产品和品牌质量,发现差异化产品行业企业呈现基于质量的竞争力(价格随远离核心能力下降),而非差异化产品行业出口销售则相反,墨西哥数据支持该预测。
We develop a new model of multi-product firms which invest to improve both the quality of their individual products and of their brand. Because of flexible manufacturing, products closer to firms’ core competence have lower costs, so they produce more of them, and also have higher incentives to invest in their quality. These two effects have opposite implications for the profile of prices. Mexican data provide robust confirmation of the model’s key prediction: firms in differentiated-good sectors exhibit quality-based competence (prices fall with distance from core competence), but export sales of firms in non-differentiated-good sectors exhibit the opposite.