De Loecker, Jan; Goldberg, Pinelopi Koujianou; … - C.E.P.R. Discussion Papers - 2012
This paper examines how prices, markups and marginal costs respond to trade liberalization. We develop a framework to … dividing observed prices by the estimated markups. We use India’s trade liberalization episode to examine how firms adjust … these performance measures. Not surprisingly, we find that trade liberalization lowers factory-gate prices. However, the …