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Private Labels and International Trade: Trading Variety for Volume

Authors: Emily Blanchard; Tatyana Chesnokova; Gerald Willmann;

Private Labels and International Trade: Trading Variety for Volume

Abstract

This paper explores the role of pooled-producer, e.g. private label, trade intermediation in shaping the range and diversity of exports. Direct sales maintain a firm's unique product characteristics ('brand equity'), whereas trade through an intermediary can take two forms - either a wholesaling arrangement that (also) maintains the exporter's unique brand but imposes a higher marginal cost (via double marginalization), or a 'private label' contract under which the firm's product is pooled with other firms' output and re-sold under a new private label brand created by the intermediary. This paper focuses on the latter, and shows that the availability of the private label option results in greater total export volumes and lower average prices for consumers, but fewer independent varieties available in equilibrium. Welfare implications are mixed: consumers trade variety for volume, firms face greater competition from the new pooled-products, and intermediaries capture much of the gains from trade.

Country
Germany
Keywords

330, ddc:330, F16, Heterogeneous Firms, Private Labels, Export Mode, Intermediaries, Heterogeneous Firms, International Retailers, Private Labels, intermediaries, D72, E60, export mode, International Retailers, private labels, export mode, intermediaries, heterogeneous firms, international retailers, private labels, heterogeneous firms, international retailers, F13, Intermediaries, Export Mode, jel: jel:D72, jel: jel:E60, jel: jel:F13, jel: jel:F16

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selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
1
Average
Average
Average
Green
bronze
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