Markup heterogeneity, export status ans the establishment of the euro

We investigate the effects of the establishment of the euro on themarkups of French manufacturing firms. Merging firm-level censusdata with customs data, we estimate time-varying firm-specific markupsand distinguish between eurozone exporters from other firms between1995 and 2007. We find that the establishment of the euro has had apronounced pro-competitive impact by reducing firm markups by 14percentage points. By reducing export costs, the euro represented anopportunity for eurozone exporters to increase their margins relativeto other firms. Quantile regressions show that the euro has led to areduction in the variance of markups