European High-End Products in International Competition

Lionel Fontagné (1, 2, 3) , Sophie Hatte (3, 4)

1 CES - Centre d'économie de la Sorbonne
2 CEPII - Centre d'Etudes Prospectives et d'Informations Internationales
3 PSE - Paris School of Economics
4 UNIROUEN - Université de Rouen Normandie

We study international competition in high-end products for 416 detailed HS6 product categories marketed by leading French luxury brands. We construct a world database of trade flows for these products in the period 1994-2009, computing unit values of related bilateral trade flows and analyzing competition among the main exporters. We use the observed distribution of unit values to define a high-end market segment. In 2009, Europe's market share (EU27 plus Switzerland) despite suffering some erosion since 1994, represented three-quarters of the world market. Exports of high-end products are shown to be less sensitive to distance than other products, and found more sensitive to destination country wealth than other products, but only in relation to countries already producing a large range of luxury brands.

Keywords: Unit values; Market shares; Product differentiation

Domains: Economics and Finance

Lionel Fontagné, Sophie Hatte. European High-End Products in International Competition. 2013. ⟨hal-00959394⟩