New evidence on income and the geographical distribution of imports: The case of audiovisuals

This paper studies how the geographical distribution of imports, in the audiovisual sector, varies with aggregate income across countries to confront existing fears of cultural homogenization with increasing purchasing power. Relying on new predictions derived from an heterogenous firms model (Helpman, Melitz & Rubinstein, 2008), two dimensions of diversity are investigated: the number of geographical origins (extensive margin) and the distribution of audiovisual imports across exporters (intensive margin). The empirical results reveal that per capita income fosters diversity up to point: income first has a positive impact on the extensive margin, yet beyond a certain threshold, the number of import sources declines. Regarding the intensive margin, per capita income reinforces the concentration of import flows across origins benefiting the most efficient partners.