| For a long time,price competition has always been a problem that has plagued China’s international trade.Whether firms can effectively participate in intermational market competition depends largely on the strength of pricing power.An important manifestation of the pricing power of firms is the implementation of differentiated pricing.Therefore,the difference in export product prices is the core issue discussed in this paper.The pricing power of firms is not only related to production costs,but also related to the non-price factors such as the degree of industrial clustering in the firm’s location,the quality of the products exported by the firm,and the type of the firm’s trade.This article first reviews the related research progress,including the influencing factors of the price difference of the export products of the firms,industrial agglomeration,quality differences and the type of the firm’s trade.Analysing the gaps and divergence of existing research,and presenting three hypotheses in the theoretical mechanism part.Then,the key variables were analyzed and estimated.Using the standard deviation and the interquartile distance method,the model of China’s export product price difference between 2000-2013 and the industrial agglomeration level reference model(2014)was calculated,and the model was backcasted afterwards.In the method,the elasticity of substitution was chosen to be 5,7 and 10,respectively,to measure the quality of the export products of the enterprise,and the quality difference was defined by the quality ladder defined by Khandelwal(2009).A descriptive analysis was also conducted on whether the firms were classified as trade-oriented firms and whether they were classified as processing trade-oriented firms.Then the paper establishes an econometric model.From the enterprise-product level and the target country-product level,it empirically analyzes the effects of industrial agglomeration,quality differences,and trade types on the price difference of export products,and verified the three hypotheses proposed in this paper.Specifically,the extent of industrial agglomeration,quality differences and the interaction term of industrial agglomeration and quality difference serve as key explanatory variables.The type of trade of the firm,the degree of economic development of the city and the destination country are used as the control variables.In the two levels of empirical analysis,in addition to the total sample,the city where the enterprise is located is divided into eastern,central and western regions,and the destination country is divided into OECD countries.The following conclusions are drawn from this study:1.The higher the level of industrial agglomeration defined by the scale of the firm’s export,the greater the price difference between the export products of the firm.2.The longer the quality ladder of the product,the higher the degree of quality difference,and the degree of industrial agglomeration.The greater the positive impact of differences in export product prices.And when the city where the enterprise is located is the eastern region and the western region,when the export destination country is a non-OECD country,the pricing power of the enterprise is more sensitive to industrial agglomeration and quality differences.Third,compared with manufacturing firms,trade-based firms will make the difference in export product prices rise.Processing and trading firms will cause the difference in export product prices to be lower than that of general trading firms.Finally,related suggestions are put forward:In areas where production firms are concentrated,the goverxment should avoid firms of the same scale from "gritting together" and encourage firms to increase the scale of exports;firms should increase the technological content of export products,enhance innovation capabilities,and gain freedom of pricing;reduce processing trade.,To develop general trade and improve the bargaining power of manufacturing firms can allow firms to obtain more pricing power in international trade. |
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