Quality Upgrading and the Stages of Diversification

Papageorgiou, Chris and Perez-Sebastian, Fidel and Spatafora, Nikola (2016): Quality Upgrading and the Stages of Diversification.

Abstract

This paper explores the contribution of product quality upgrading in the process of export diversification. To do this, the paper builds a multisector model following Eaton and Kortum (2002) in which product quality is incorporated as a key feature. The model is then calibrated to generate predictions about the degree of export diversification in a number of East Asian countries. It is shown that quality upgrading is a key factor to understand the changes in the degree of export diversification in the majority of countries in our sample.

• Item Type: MPRA Paper
• Language: English
• Keywords: export diversification, product quality, international trade, structural transformation.
• Subjects: F - International Economics > F1 - Trade > F10 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O14 - Industrialization ; Manufacturing and Service Industries ; Choice of Technology; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O40 - General

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