Description

We explore whether the global financial crisis has had heterogeneous effects on traded goods
 differentiated by quality. Combining a dataset of Argentinean firm-level destination-specific
 wine exports with quality ratings, we show that higher quality exports grew faster before the
 crisis, but this trend reversed during the recession. Quantitatively, the effect is large: up to
 nine percentage points difference in trade performance can be explained by the quality
 composition of exports. This flight from quality was triggered by a fall in aggregate demand,
 was more acute when households could substitute imports by domestic alternatives, and was
 stronger for smaller firms' exports.

More publications in this series: Working Papers

More publications by: Natalie Chen ; Luciana Juvenal