This paper estimates the agglomeration benefits that arise from vertical linkages between firms in the context of Indonesia. The analysis is based on international trade and economic geography theory developed by Krugman and Venables (1995). We identify the agglomeration benefits off the spatial...

The Argentine economy has gone through important reforms during the nineties. Many of these reforms aimed at integrating the domestic economy with world trade and investment flows. There is a vast theoretical literature that links trade and investment liberalization with technological progress...

The relevance of transport costs has increased as liberalization continues to reduce artificial barriers to trade. Countries need to adopt policies to “get closer†to global markets. Can improvements in infrastructure and regulation reduce transport costs? Is it worthwhile to implement...

Two main results have been obtained on the literature on contractual solutions to the hold-up problem. First, a contract specifying a price and quantity of the final good to be traded will, fairly generally, induce efficient investments if these are `selfish' in nature, i.e., each party's...

This paper develops a theory of outside ownership where such an ownership arrangement mitigates an external finance problem. Part of the gains from outside ownership accrue to asset owners which determines the asset value. The theory provides a context to analyze asset ownership and asset values...

The objective of this paper is to add evidence of job mobility within a firm using personnel records from a single large U.S. corporation, focusing on the determinants of the hazard rates of being promoted to a higher hierarchy level. How to successfully control for unobserved heterogeneity is...

Most existing theories of the firms define a firm as a collection of physical assets, and hence can not explain the firm from a human-asset perspective, which is of particular importance for understanding human-capital intensive firms. To fill in the gap, this paper proposes an alternative...

The incomplete nature of contracts governing international transactions limits the extent to which the production process can be fragmented across borders. In a dynamic, general-equilibrium Ricardian model of North-South trade, the incompleteness of international contracts is shown to lead to...

This paper considers the parametric inference of a wide range of structural econometric models. The class of models considered includes those with parameter-dependent support and those derived from game-theoretic models. Inference of those models has raised some important econometric issues....

Within the independent private-values paradigm, we derive the data-generating process of the winning bid for the last unit sold at sequential English auctions when bidder valuations are draws from one of several different classes of distributions; i.e., in the presence of asymmetries. When the...