Multiproduct firms and scope adjustment in globalization

A-Tier
Journal: Journal of International Economics
Year: 2013
Volume: 91
Issue: 1
Pages: 142-153

Authors (2)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

A model of heterogeneous firms with variety-specific fixed costs is developed and analyzed to study how multiproduct firms respond to globalization. In contrast with most existing models, the analysis demonstrates that more-productive firms may expand their product scope, which in turn may push up their average costs. A necessary and sufficient condition for scope expansion is that the fixed cost of introducing more varieties increases rapidly with the product scope. With increasing globalization, the percentage of scope-expanding firms diminishes and eventually becomes zero.

Technical Details

RePEc Handle
repec:eee:inecon:v:91:y:2013:i:1:p:142-153
Journal Field
International
Author Count
2
Added to Database
2026-01-29