NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

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.

download in pdf format
   (372 K)

email paper

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
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

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

Contact Us