European high-end varieties in international competition

Abstract

We study international competition in high-end varieties for 416 detailed HS6 product categories marketed by the leading French luxury brands. We construct a world database of trade flows for these products, 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. Exports of high-end varieties are shown to be less sensitive to distance, and found more sensitive to destination country wealth than other varieties, but only in relation to countries already producing a large range of luxury brands, pointing to a first-mover advantage.