We propose a simple model of trade outside the law preyed on by robbers and possiblyprotected by private cops. We … establish the conditions for trade collapse, secure trade andinsecure trade. Endogenous predation and enforcement can explain … both puzzling failures ofcommonly observed state policies against illegal trade and puzzlingly large trade responses …

The high trade costs inferred from gravity are rarely used in thewide class of trade models. Two related problems … explain this omis-sion of a key explanatory variable. First, national seller and buyer re-sponses to trade costs depend on … their incidence rather than on the fullcost. Second, the high dimensionality of bilateral trade costs requiresaggregation …

contracting institutionsis not feasible an equivalent solution is to increase openness to international trade. This …This paper studies the e¤ects of international openness and contracting institutions on verticalintegration. It …rst … derives a number of predictions regarding the interactions between trade bar-riers, contracting costs, technology intensity …