This paper explores the combined effects of reductions in trade frictions, tariffs, and firing costs on firm dynamics, job turnover, wage distributions. It uses establishment-level data from Colombia to estimate an open economy dynamic model that links flows wages. Counterfactual experiments imply Colombia's integration with global product markets increased its national income at expense higher unemployment, greater inequality, firm-level volatility. In contrast, contemporaneous labor market...

We introduce an internal geography to the canonical model of international trade driven by comparative advantages study regional effects external economic integration. The features a dual-economy structure, in which locations near gates specialize export-oriented sectors while more distant do not with rest world. theory rationalizes patterns specialization, employment, and relative incomes observed developing countries that opened up trade. find specialization consistent industry-level data...

Abstract We analyze a large data set of commercial records produced by Assyrian merchants in the nineteenth century BCE. Using information from these records, we estimate structural gravity model long-distance trade Bronze Age. use our to locate lost ancient cities. In many cases, estimates confirm conjectures historians who follow different methodologies. some instances, one conjecture against others. also structurally city sizes and offer evidence support hypothesis that cities tend emerge...

In the automobile industry, as in many tradable goods markets, firms usually earn their highest market share within domestic market. The goal of this paper is to disentangle supply- and demand-driven sources home advantage. While trade costs, foreign production taste heterogeneity all matter for outcomes, we find that a preference brands single most important driver advantage—even after controlling brand histories dealer networks. Furthermore, also consumers favor domestically producing even...

This paper explores the combined effects of reductions in trade frictions, tariffs, and firing costs on firm dynamics, job turnover, wage distributions.It uses establishment-level data from Colombia to estimate an open economy dynamic model that links flows a new way.The fitted captures key features Colombian dynamics labor market outcomes, as well changes these during past 25 years.Counterfactual experiments imply integration with global product markets has increased both average income...

This paper explores the combined effects of reductions in trade frictions, tariffs, and firing costs on firm dynamics, job turnover, wage distributions. It uses establishment-level data from Colombia to estimate an open economy dynamic model that links flows a new way. The fitted captures key features Colombian dynamics labor market outcomes, as well changes these during past 25 years. Counterfactual experiments imply integration with global product markets has increased both average income...

Abstract What is the impact on intra-national trade and regional economic outcomes when quality lane-capacity of an existing paved road network expanded significantly? We investigate this question for case Turkey, which undertook a large-scale public investment in roads during 2000s. Using spatially disaggregated data upgrades domestic transactions, we estimate large positive reduced travel times as well local manufacturing employment wages. A quantitative exercise using workhorse model...

Using a microlevel data set of wind turbine installations in Denmark and Germany, we estimate structural oligopoly model with cross-border trade heterogeneous firms. Our approach separately identifies border-related from distance-related variable costs bounds the fixed cost exporting for each firm. In data, firms' market shares drop precipitously at border. We find that 40% to 50% gap can be attributed national border costs. Counterfactual analysis indicates eliminating frictions would...

This paper presents a model of development in which skilled labor is an input technology adoption. The combines Nelson and Phelps (1966) type dynamics with growth intermediate goods are used to produce final good. good producers hire increase their productivity by adopting techniques from exogenously evolving stock world knowledge. I solve for the stationary equilibrium derive analytic expressions steady state income level wage premium. In quantitative exercise, calibrate compare its...

We analyze a large dataset of commercial records produced by Assyrian merchants in the 19th Century BCE.Using information collected from these records, we estimate structural gravity model long-distance trade Bronze Age.We use our to locate lost ancient cities.In many instances, estimates confirm conjectures historians who follow different methodologies.In some one conjecture against others.Confronting for city sizes modern data on population, income, and regional trade, document persistent...

We quantify the effect of container technology on transport costs and trade by estimating modal choice between containerization breakbulk shipping using micro-level data. The model is motivated novel facts that relate usage to shipment, destination firm characteristics. find have a higher first-mile cost lower distance elasticity, making it effective in longer distances. At median across all country pairs, box decreases variable 16 22 percent. explains significant amount global increase...

Using a micro-level dataset of Danish and German wind turbine installations, we estimate structural oligopoly model with cross-border trade heterogeneous firms. Our approach allows us to separately identify border-related variable costs from distance-related costs, put bounds on fixed exporting. We find that the border are large, equivalent 400 kilometers (250 miles) in transport costs. Counterfactual analysis shows also important; removal would increase market share Denmark 2 12 percent....

We characterize the necessary and sufficient conditions for optimality in discrete-time, infinite-horizon optimization problems with a state space of finite or infinite dimension. It is well known that challenging task this problem to prove necessity transversality condition. To do this, we follow duality approach an abstract linear space. Our proof resembles Kamihigashi (2003), but does not explicitly use results from real analysis. As application, formalize Sims's argument no-Ponzi...