Research
Published articles
Guerra, F. (2023). Export quality and wage premium. Review of World Economy
Abstract: A growing body of research suggests a positive association between the quality of export products and income per capita, arguing that quality upgrades affect income through changes in the relative demand for skilled labor. My research falls within this literature and intends to shed light on the effect of quality upgrades of export products on average wages at the industry level. The study is conducted on the manufacturing sector over a set of 23 countries for which industry-level wage data are available. Contrary to previous studies which use unit values as an indirect measure of product quality, we rely on the methodology proposed by Khandelwal (2010) and estimate quality as a residual of a demand equation. To establish a direct causal link between export quality upgrades and changes in wages, I use an instrumental variable strategy. Under the assumption that higher-income countries import higher-quality products, quality is instrumented with the change in demand for quality in importing countries. My results show that ahead of upgrades to export quality within a specific industry, average wages offered within the industry increase. In addition, I observe that the effect is larger for developing countries. The findings of this study imply that export product quality upgrades require more intensive use of qualified workers, who require higher wages.
Guerra, F. (2023). How taste proximity affects consumer quality valuation of imported varieties: Evidence from the French food sector. The World Economy, 46(9), 2857-2890.
Doi: 10.1111/twec.13458
Abstract: Consumer tastes for food products can differ substantially between countries and represent an important element of trade promotion. However, few studies indicate that divergences in consumer tastes may also generate differences in the perception of the attractiveness of products. In this study, I investigate how cross-country taste proximity for food products affects consumer quality valuation of imported varieties in destination countries. Based on firm-product level customs data on French exports, I analyze how differences in consumer tastes across destination markets influence the export revenues of vertically differentiated varieties. To identify taste proximity, I rely on data gathered from the online travel company TripAdvisor, which reports information on the type of cuisine offered in restaurants all over the world. The measure of taste proximity is derived through the use of a control function in a gravity model and corresponds to the unobserved affinity in taste for food products between consumers of trading partners. I find that firms that export high-quality products exhibit relatively larger export revenues in countries with high taste proximity. My results indicate that quality is more strongly appreciated and consumers are more willing to spend on high-quality products imported from France in countries with a taste similar to that of French consumers.
Guerra, F., Napoléone, C., Paoli, J. C., & Moulery, M. (2021). L’impact de l’agriculture sur les incendies de forêt et leur propagation dans les régions méditerranéennes françaises. Cahiers de la Méditerranée, (102), 145-161.
Doi: 10.4000/cdlm.14660
Abstract: The Mediterranean region is prone to wildfires while ecological concerns generate a strong institutional commitment to the fight. However, the question of prevention remains open: while it is agreed that the majority of wildfires are human-caused, there is no consensus model to localize this relationship. One way is to estimate the role that land use plays in the number or intensity of past fires. To this end, we examine the impact of agriculture on fire via a quantitative analysis of the effect of agricultural land use on fire occurrence and extent. Our results provide a profile of municipalities that are more exposed to wildfire risk due to the presence of certain types of crops or agricultural activities. However, they show a complex relationship with respect to the agricultural space as a whole, which can be characterized from a reasoned classification of productions (market gardening reduces occurrences and extensive rangelands increase them) or spatial dynamics (abandoned spaces reduce occurrences and increase extents).
Work in Progress
Studying the impact of unfavorable trade shocks on firms via Machine Learning methods
Abstract: This research explores the complex impacts of negative trade shocks on French companies using advanced machine learning techniques. The aim of the project is to analyze how French companies have reacted to these shocks and to identify the characteristics of those that have successfully redirected their exports, taking into account the complex dynamics of interconnected markets where other countries have also faced the same challenge. In addition, the project examines the impact on production and employment, distinguishing between workers according to the positions they occupy. By comprehensively examining these aspects, the research aims to provide information for policy-makers in dealing with trade shocks and their consequences.
Product quality and export volatility
Abstract: A growing literature focuses on the channels through which product quality improves trade performances. In this paper we examine whether quality of a product affects the volatility of its trade flows focusing on a demand-driven mechanism. Fluctuations on the demand of imported products are mainly due to income variability and represents a major source of trade volatility for the exporters. Under the hypothesis that higher quality products are more income elastic than the lower quality ones, we expect to observe a higher variability in export volumes for high-quality products. The analysis is conducted on bilateral trade for more than 100 countries over the period 1997 – 2008. To estimate product quality, we rely on a residual-demand approach and infer quality as a residual of a structural demand model. The results show that export of high quality products are more volatile on international markets, and that the export volatility increases with quality as the variability of income per capita of the importer growths.