Mark-up and Cost Dispersion across Firms: Direct Evidence from Producer Surveys in Pakistan

David Atkin, Azam Chaudhry, Shamyla Chaudry, Amit K. Khandelwal, Eric Verhoogen

NBER Working Paper No. 20868
Issued in January 2015
NBER Program(s):Development Economics, International Trade and Investment, Productivity, Innovation, and Entrepreneurship

Researchers typically invoke theoretical assumptions to estimate mark-ups. Instead, we directly obtain mark-ups by surveying Pakistani soccer-ball producers. We document six facts: (1) Mark-ups are more dispersed than costs; (2) Mark-ups and costs increase with firm size; (3) The mark-up elasticity with respect to size exceeds the cost elasticity; (4) Costs increase with size because larger firms use higher-quality inputs; (5) Larger firms charge higher mark-ups because they have higher production shares of high-quality balls that carry higher mark-ups, and because they charge higher mark-ups conditional on ball type; (6) Correlations suggest marketing efforts are important for generating higher mark-ups.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Access to NBER Papers

You are eligible for a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w20868

Published: David Atkin & Azam Chaudhry & Shamyla Chaudhry & Amit K. Khandelwal & Eric Verhoogen, 2015. "Markup and Cost Dispersion across Firms: Direct Evidence from Producer Surveys in Pakistan," American Economic Review, American Economic Association, vol. 105(5), pages 537-44, May. citation courtesy of

Users who downloaded this paper also downloaded* these:
Dix-Carneiro and Kovak w20912 Trade Liberalization and the Skill Premium: A Local Labor Markets Approach
Edmond, Midrigan, and Xu w18041 Competition, Markups, and the Gains from International Trade
Burstein, Morales, and Vogel w20855 Accounting for Changes in Between-Group Inequality
Atkin, Khandelwal, and Osman w20690 Exporting and Firm Performance: Evidence from a Randomized Trial
Bems and Johnson w21070 Demand for Value Added and Value-Added Exchange Rates
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us