Globalization, Markups, and US Welfare

This paper estimates the impact of globalization on markups, and the effect of changing markups on US welfare, in a monopolistic competition model. We work with symmetric translog preferences, which allow for endogenous markups and firm entry and exit, thereby changing product variety. We find that...

Full description

Saved in:
Bibliographic Details
Published in:The Journal of political economy 2017-08, Vol.125 (4), p.1040-1074
Main Authors: Feenstra, Robert C., Weinstein, David E.
Format: Article
Language:English
Subjects:
Economic theory
Endogenous
Globalization
Imports
Markups
Monopolistic competition
Political economy
Studies
US imports
Welfare
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
cited_by cdi_FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323
cites cdi_FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323
container_end_page 1074
container_issue 4
container_start_page 1040
container_title The Journal of political economy
container_volume 125
creator Feenstra, Robert C.
Weinstein, David E.
description This paper estimates the impact of globalization on markups, and the effect of changing markups on US welfare, in a monopolistic competition model. We work with symmetric translog preferences, which allow for endogenous markups and firm entry and exit, thereby changing product variety. We find that between 1992 and 2005, US import shares rose and US firms exited, leading to an implied fall in markups, while variety went up because of imports. US welfare rose by nearly 1 percent as a result of these changes, with product variety contributing onehalf of that total and declining markups the other half.
doi_str_mv 10.1086/692695
format article
fullrecord <record><control><sourceid>jstor_uchic</sourceid><recordid>TN_cdi_uchicagopress_journals_692695</recordid><sourceformat>XML</sourceformat><sourcesystem>PC</sourcesystem><jstor_id>26550435</jstor_id><sourcerecordid>26550435</sourcerecordid><originalsourceid>FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323</originalsourceid><addsrcrecordid>eNqN0EtLxDAUBeAgCtZR_4FQUAYXU82zTZYy6CiMuNBBdyHNQ1trU5N2ob_eSkW33s3dfJwDB4BDBM8Q5Pl5LnAu2BZIECNFxgh92gYJhBhnhEO-C_ZirOF4CJIEzFeNL1VTfaq-8u0ivVXhdejiIlWtSTf36aNtnAp2H-w41UR78PNnYHN1-bC8ztZ3q5vlxTrTRIg-c5wbQzmG3OHSIkMNKiliRZkbLBQTqBDOYaKxg0obYgtuy6LkznBlrSaYzMDxlNsF_z7Y2MvaD6EdKyUSnHJEIUOjmk9KBx9jsE52oXpT4UMiKL83kNMGIzyd4KBfKq2efRdsjH-ZE5OdcSM9-Qcd2dHE6tj78NuLc8YgJYx8AbKAcNE</addsrcrecordid><sourcetype>Aggregation Database</sourcetype><iscdi>true</iscdi><recordtype>article</recordtype><pqid>1984814051</pqid></control><display><type>article</type><title>Globalization, Markups, and US Welfare</title><source>EBSCOhost Business Source Ultimate</source><source>International Bibliography of the Social Sciences (IBSS)</source><source>University of Chicago Press Journals (Full run)</source><source>EBSCOhost Econlit with Full Text</source><source>JSTOR Archival Journals and Primary Sources Collection</source><creator>Feenstra, Robert C. ; Weinstein, David E.</creator><creatorcontrib>Feenstra, Robert C. ; Weinstein, David E.</creatorcontrib><description>This paper estimates the impact of globalization on markups, and the effect of changing markups on US welfare, in a monopolistic competition model. We work with symmetric translog preferences, which allow for endogenous markups and firm entry and exit, thereby changing product variety. We find that between 1992 and 2005, US import shares rose and US firms exited, leading to an implied fall in markups, while variety went up because of imports. US welfare rose by nearly 1 percent as a result of these changes, with product variety contributing onehalf of that total and declining markups the other half.</description><identifier>ISSN: 0022-3808</identifier><identifier>EISSN: 1537-534X</identifier><identifier>DOI: 10.1086/692695</identifier><language>eng</language><publisher>Chicago: University of Chicago Press</publisher><subject>Economic theory ; Endogenous ; Globalization ; Imports ; Markups ; Monopolistic competition ; Political economy ; Studies ; US imports ; Welfare</subject><ispartof>The Journal of political economy, 2017-08, Vol.125 (4), p.1040-1074</ispartof><rights>2017 by The University of Chicago</rights><rights>2017 by The University of Chicago. All rights reserved.</rights><rights>Copyright University of Chicago, acting through its Press Aug 2017</rights><lds50>peer_reviewed</lds50><woscitedreferencessubscribed>false</woscitedreferencessubscribed><citedby>FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323</citedby><cites>FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323</cites></display><links><openurl>$$Topenurl_article</openurl><openurlfulltext>$$Topenurlfull_article</openurlfulltext><thumbnail>$$Tsyndetics_thumb_exl</thumbnail><linktopdf>$$Uhttps://www.jstor.org/stable/pdf/26550435$$EPDF$$P50$$Gjstor$$H</linktopdf><linktohtml>$$Uhttps://www.jstor.org/stable/26550435$$EHTML$$P50$$Gjstor$$H</linktohtml><link.rule.ids>314,780,784,27924,27925,33223,54019,54023,58238,58471</link.rule.ids></links><search><creatorcontrib>Feenstra, Robert C.</creatorcontrib><creatorcontrib>Weinstein, David E.</creatorcontrib><title>Globalization, Markups, and US Welfare</title><title>The Journal of political economy</title><description>This paper estimates the impact of globalization on markups, and the effect of changing markups on US welfare, in a monopolistic competition model. We work with symmetric translog preferences, which allow for endogenous markups and firm entry and exit, thereby changing product variety. We find that between 1992 and 2005, US import shares rose and US firms exited, leading to an implied fall in markups, while variety went up because of imports. US welfare rose by nearly 1 percent as a result of these changes, with product variety contributing onehalf of that total and declining markups the other half.</description><subject>Economic theory</subject><subject>Endogenous</subject><subject>Globalization</subject><subject>Imports</subject><subject>Markups</subject><subject>Monopolistic competition</subject><subject>Political economy</subject><subject>Studies</subject><subject>US imports</subject><subject>Welfare</subject><issn>0022-3808</issn><issn>1537-534X</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2017</creationdate><recordtype>article</recordtype><sourceid>8BJ</sourceid><recordid>eNqN0EtLxDAUBeAgCtZR_4FQUAYXU82zTZYy6CiMuNBBdyHNQ1trU5N2ob_eSkW33s3dfJwDB4BDBM8Q5Pl5LnAu2BZIECNFxgh92gYJhBhnhEO-C_ZirOF4CJIEzFeNL1VTfaq-8u0ivVXhdejiIlWtSTf36aNtnAp2H-w41UR78PNnYHN1-bC8ztZ3q5vlxTrTRIg-c5wbQzmG3OHSIkMNKiliRZkbLBQTqBDOYaKxg0obYgtuy6LkznBlrSaYzMDxlNsF_z7Y2MvaD6EdKyUSnHJEIUOjmk9KBx9jsE52oXpT4UMiKL83kNMGIzyd4KBfKq2efRdsjH-ZE5OdcSM9-Qcd2dHE6tj78NuLc8YgJYx8AbKAcNE</recordid><startdate>20170801</startdate><enddate>20170801</enddate><creator>Feenstra, Robert C.</creator><creator>Weinstein, David E.</creator><general>University of Chicago Press</general><general>University of Chicago, acting through its Press</general><scope>AAYXX</scope><scope>CITATION</scope><scope>8BJ</scope><scope>FQK</scope><scope>JBE</scope></search><sort><creationdate>20170801</creationdate><title>Globalization, Markups, and US Welfare</title><author>Feenstra, Robert C. ; Weinstein, David E.</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2017</creationdate><topic>Economic theory</topic><topic>Endogenous</topic><topic>Globalization</topic><topic>Imports</topic><topic>Markups</topic><topic>Monopolistic competition</topic><topic>Political economy</topic><topic>Studies</topic><topic>US imports</topic><topic>Welfare</topic><toplevel>peer_reviewed</toplevel><toplevel>online_resources</toplevel><creatorcontrib>Feenstra, Robert C.</creatorcontrib><creatorcontrib>Weinstein, David E.</creatorcontrib><collection>CrossRef</collection><collection>International Bibliography of the Social Sciences (IBSS)</collection><collection>International Bibliography of the Social Sciences</collection><collection>International Bibliography of the Social Sciences</collection><jtitle>The Journal of political economy</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>Feenstra, Robert C.</au><au>Weinstein, David E.</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>Globalization, Markups, and US Welfare</atitle><jtitle>The Journal of political economy</jtitle><date>2017-08-01</date><risdate>2017</risdate><volume>125</volume><issue>4</issue><spage>1040</spage><epage>1074</epage><pages>1040-1074</pages><issn>0022-3808</issn><eissn>1537-534X</eissn><abstract>This paper estimates the impact of globalization on markups, and the effect of changing markups on US welfare, in a monopolistic competition model. We work with symmetric translog preferences, which allow for endogenous markups and firm entry and exit, thereby changing product variety. We find that between 1992 and 2005, US import shares rose and US firms exited, leading to an implied fall in markups, while variety went up because of imports. US welfare rose by nearly 1 percent as a result of these changes, with product variety contributing onehalf of that total and declining markups the other half.</abstract><cop>Chicago</cop><pub>University of Chicago Press</pub><doi>10.1086/692695</doi><tpages>35</tpages></addata></record>
fulltext fulltext
identifier ISSN: 0022-3808
ispartof The Journal of political economy, 2017-08, Vol.125 (4), p.1040-1074
issn 0022-3808
1537-534X
language eng
recordid cdi_uchicagopress_journals_692695
source EBSCOhost Business Source Ultimate; International Bibliography of the Social Sciences (IBSS); University of Chicago Press Journals (Full run); EBSCOhost Econlit with Full Text; JSTOR Archival Journals and Primary Sources Collection
subjects Economic theory
Endogenous
Globalization
Imports
Markups
Monopolistic competition
Political economy
Studies
US imports
Welfare
title Globalization, Markups, and US Welfare
url http://sfxeu10.hosted.exlibrisgroup.com/loughborough?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&ctx_tim=2025-01-04T02%3A47%3A59IST&url_ver=Z39.88-2004&url_ctx_fmt=infofi/fmt:kev:mtx:ctx&rfr_id=info:sid/primo.exlibrisgroup.com:primo3-Article-jstor_uchic&rft_val_fmt=info:ofi/fmt:kev:mtx:journal&rft.genre=article&rft.atitle=Globalization,%20Markups,%20and%20US%20Welfare&rft.jtitle=The%20Journal%20of%20political%20economy&rft.au=Feenstra,%20Robert%20C.&rft.date=2017-08-01&rft.volume=125&rft.issue=4&rft.spage=1040&rft.epage=1074&rft.pages=1040-1074&rft.issn=0022-3808&rft.eissn=1537-534X&rft_id=info:doi/10.1086/692695&rft_dat=%3Cjstor_uchic%3E26550435%3C/jstor_uchic%3E%3Cgrp_id%3Ecdi_FETCH-LOGICAL-c399t-f88dd48208f2be1d4d1b4157b6d29a59179ff23c2f0acd3e78eb7b8fd8aeec323%3C/grp_id%3E%3Coa%3E%3C/oa%3E%3Curl%3E%3C/url%3E&rft_id=info:oai/&rft_pqid=1984814051&rft_id=info:pmid/&rft_jstor_id=26550435&rfr_iscdi=true