Quality and Trade with Many Countries and Industries
Pierre M Picard  1@  
1 : University of Luxembourg [Luxembourg]  -  Website
Campus Kirchberg6, rue Richard Coudenhove-KalergiL-1359 LuxembourgCampus de Limpertsberg162a, avenue de la FaïencerieL-1511 LuxembourgCampus de Belval2, avenue de lÚniversitéL-4365 Esch-sur-Alzette -  Luxembourg

This paper investigates a trade model with many countries, many goods produced in multiple quality versions and non-homothetic preferences. It studies the impact of productivity, population changes and trade costs on the quality composition of exports. The analysis embeds within the same model a series of empirical results about high-income countries' specialisation and trade in higher quality goods. Product differentiation matters at explaining the volumes of trade quality. High-quality goods exhibing a high degree of differentiation are traded only by high-income countries.


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