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    Sourcing product quality for foreign market entry (2019)

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    Sourcing_Quality_FDI_10072019.pdf (522.4Kb)
    Type of Content
    Journal Article
    UC Permalink
    https://hdl.handle.net/10092/102504
    
    Publisher's DOI/URI
    http://doi.org/10.1007/s10290-020-00375-1
    
    Publisher
    Springer Science and Business Media LLC
    ISSN
    1610-2878
    1610-2886
    Language
    en
    Collections
    • Business: Journal Articles [255]
    Authors
    Koska OA
    show all
    Abstract

    This study employs a differentiated Cournot model with both horizontal and vertical product differentiation. It scrutinizes the implications of frictions over manufacturing high quality (upstream market power) on the endogenous foreign market entry mode and product quality choice. Both high-quality exports and subsidiary sales require high-quality inputs supplied by a monopoly upstream firm, and thus are costly. Relative product quality, product substitutability, and product-specific trade costs are the key for the variation in input/output prices, sales and the markup between an exporter and a multinational, and have significant trade policy implications for high-quality exports and subsidiary sales.

    Citation
    Koska OA (2020). Sourcing product quality for foreign market entry. Review of World Economics.
    This citation is automatically generated and may be unreliable. Use as a guide only.
    Keywords
    Vertical Product Differentiation; Horizontal Product Differentiation; Upstream Market Power; Trade; Foreign Direct Investment
    ANZSRC Fields of Research
    38 - Economics::3801 - Applied economics::380107 - Financial economics
    35 - Commerce, management, tourism and services::3502 - Banking, finance and investment::350202 - Finance
    Rights
    All rights reserved unless otherwise stated
    http://hdl.handle.net/10092/17651

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