Country size matters in determining the effectiveness of domestic and foreign competition on pricing behavior in manufacturing. Removing barriers to entry of new firms reduces markups more in large countries, while removing barriers to imports reduces markups more in small countries

This paper examines whether exporting activity matters for firm's price cost margins. The recent literature on exporting and productivity shows that exporters on average are more efficient than nonexporters. If that is the case we may also expect them to have different mark-ups. We investigate...