| dc.description.abstract | Multiproduct exporters play a dominant role in international trade, yet their strategic decisions as multiproduct firms, particularly regarding product bundling, have received limited attention in the trade literature. This dissertation fills this gap by being the first to thoroughly investigate the practice of product bundling among multiproduct firms in international trade.
Chapter 2 presents new evidence on the nature and prevalence of product bundling in international markets. Through the analysis of transaction-level data, it is revealed that more than a third of all international transactions involve the simultaneous sale of multiple goods within a single transaction. These findings emphasize the pervasive use of product bundling across countries and products, suggesting that studying its impact on international trade can provide valuable insights into the operational strategies of multiproduct firms.
However, estimating markups poses a challenge when considering joint pricing decisions for product bundling. To address this challenge, Chapter 3 introduces a novel framework for estimating joint markups that takes into account the strategic decisions of multiproduct firms regarding product bundling practices. Building upon the methodology proposed in Chapter 3, Chapter 4 delves into the examination of how product bundling impacts firm-level markups in international trade, with a specific focus on Chinese exporters. The analysis reveals that multiproduct exporters who engage in bundling practices, particularly those exporting bundles of computer parts, enjoy markups that are approximately 30\% higher compared to firms exporting individual computer parts without bundling. However, these markup premiums experienced by bundling firms are partially eroded following China's accession to the World Trade Organization (WTO) due to increased competition.
Finally, in Chapter 5, the dissertation investigates the entry and exit dynamics of multiproduct firms in international markets, taking into consideration the role of demand heterogeneity and the influence of past export experiences. The findings shed light on the factors that shape the export decisions of multiproduct firms, contributing to a deeper understanding of their behavior in international trade. | |
