Markup heterogeneity, export status ans the establishment of the euro
Abstract
We investigate the effects of the establishment of the euro on the
markups of French manufacturing firms. Merging firm-level census
data with customs data, we estimate time-varying firm-specific markups
and distinguish between eurozone exporters from other firms between
1995 and 2007. We find that the establishment of the euro has had a
pronounced pro-competitive impact by reducing firm markups by 14
percentage points. By reducing export costs, the euro represented an
opportunity for eurozone exporters to increase their margins relative
to other firms. Quantile regressions show that the euro has led to a
reduction in the variance of markups.
Domains
Economics and Finance
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