TY  - JOUR
AU  - Hummels,David
AU  - Skiba,Alexandre
TI  - Shipping the Good Apples Out? An Empirical Confirmation of the Alchian-Allen Conjecture
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9023
PY  - 2002
Y2  - June 2002
UR  - http://www.nber.org/papers/w9023
L1  - http://www.nber.org/papers/w9023.pdf
N1  - Author contact info:
David Hummels
Krannert School of Management
403 West State Street
Purdue University
West Lafayette, IN  47907-1310
Tel: 765/494-4495
Fax: 765/494-9658
E-Mail: hummelsd@purdue.edu

Alexandre Skiba
Department of Economics, University of Kansas
1300 Sunnyside Ave
Lawrence KS 66045
E-Mail: skiba@ku.edu
AB  - We model demand for quality differentiated goods to derive a relationship between trade costs and the quality composition of trade.  Detailed data on traded goods' prices, quantities and shipping costs for many importers and exporters are used to test these predictions.  These data provide a strong rejection of the iceberg assumption on transportation costs and a strong confirmation of the classical Alchian Allen hypothesis.  Within a narrowly defined commodity classification, exporters charge destination-varying prices that co-vary positively with shipping costs and negatively with tariffs.   Shipping costs operate as a quantitative restriction similar to quotas.
ER  -