Explaining Import Quality : the Role of the Income Distribution

  title={Explaining Import Quality : the Role of the Income Distribution},
  author={Yo Chul Choia and David Hummelsb and Chong Xiangb},
  • Yo Chul Choia, David Hummelsb, Chong Xiangb
  • Published 2009
We examine a generalized version of Flam and Helpman (1987) in which consumption prices for quality differentiated goods are rising in household income. We provide propositions for aggregating this relationship across heterogenous households to map crosscountry differences in income distributions to cross-country differences in import price distributions. The theoretical predictions are examined and confirmed using disaggregated data on prices of traded goods and micro data on household income… CONTINUE READING

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