Bastos, PauloSilva, JoanaVerhoogen, Eric2014-06-252014-06-252014-06https://hdl.handle.net/10986/18766This paper examines the extent to which the destination of exports matters for the input prices paid by firms, using detailed customs and firm-product-level data from Portugal. The authors use exchange rate movements as a source of variation in export destinations and find that exporting to richer countries leads firms to charge more for outputs and pay higher prices for inputs, other things equal. The results are supportive of the hypothesis that an exogenous increase in average destination income leads firms to raise the average quality of goods they produce and to purchase higher-quality inputs.en-USCC BY 3.0 IGOACCESS TO FOREIGN MARKETSACCOUNTINGADVERTISINGAVERAGE PRICESCHECKSCONSTANT RETURNS TO SCALECONSUMERSCURRENCYDEVALUATIONDEVELOPING COUNTRIESDEVELOPMENT POLICYDOMESTIC MARKETDOMESTIC MARKETSECONOMETRIC MODELSECONOMETRICSECONOMICSELASTICITY OF SUBSTITUTIONEQUILIBRIUMEQUILIBRIUM PRICEEXCHANGE RATEEXCHANGE RATE MOVEMENTSEXPENDITURESEXPORT MARKETSEXPORT SHAREEXPORT SHARESEXPORTEREXPORTERSEXPORTSEXTERNAL TRADEFINANCIAL CRISISFIRM PERFORMANCEFIXED COSTSFIXED INVESTMENTFIXED INVESTMENTSGDPGDP PER CAPITAGLOBAL ECONOMYGLOBALIZATIONHOME COUNTRYHOME MARKETHOMOGENEOUS GOODHOMOGENEOUS GOODSINCOMEINCOME INSTRUMENTINCOME LEVELINCOMESINDIVIDUAL FIRMINDIVIDUAL FIRMSINFLATIONINFLATION RATESINPUT PRICESINSTRUMENTINTERNATIONAL BANKINTERNATIONAL ECONOMICSINTERNATIONAL ECONOMYINTERNATIONAL FINANCIAL STATISTICSINTERNATIONAL TRADEINTERNATIONAL TRANSACTIONSINVISIBLE HANDLABOR MARKETSLEVEL OF CONFIDENCELOCAL CURRENCYMACROECONOMICSMARGINAL COSTMARKET BEHAVIORMARKET POWERMARKETINGMIDDLE-INCOME COUNTRYOPEN ECONOMIESOPTIMIZATIONOUTPUTSPARTICULAR COUNTRIESPOLITICAL ECONOMYPOSITIVE EFFECTSPRICE ELASTICITYPRICE ELASTICITY OF DEMANDPRICE INCREASEPRICE INCREASESPRICE INDEXPRICE LEVELPRICE LEVELSPRICE MOVEMENTSPRICE STABILITYPRODUCT DIFFERENTIATIONPRODUCT QUALITYPRODUCTION COSTSPRODUCTION FUNCTIONPRODUCTIVITYPRODUCTIVITY GROWTHPRODUCTIVITY INCREASESPURCHASINGRATES OF INFLATIONREAL EXCHANGE RATEREAL EXCHANGE RATESRESERVERESERVE BANKRETURNSSALESSCALE EFFECTSSUBSTITUTIONSUPPLIERSUPPLIERSTAXTAX SYSTEMTOTAL OUTPUTTOTAL SALESTRADE LIBERALIZATIONTRADINGUNDERESTIMATESUNEMPLOYMENTUTILITY FUNCTIONVARIABLE COSTWAGESWORLD DEVELOPMENT INDICATORSWORLD ECONOMY10.1596/1813-9450-6914