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This paper discusses the relation between trade and competition, revising the literature and using indicators, build … domestic competition is explained by concentration indices, such as CR4 and HHI, which show positive correlation with profit … exercise is based on a recent literature relating mark-ups, market concentration and globalization processes (investment, trade …
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We present, extend and estimate a model of international trade with firm heterogeneity in the tradition of Melitz (2003) and Melitz and Ottaviano (2005). The model is constructed to yield testable implications for the dynamics of international prices, productivity levels and markups as functions...
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