For many years, offshore wind was the expensive cousin of onshore wind with generation costs in the range of USD 150 to USD 200 per megawatt hour (MWh). This changed dramatically between 2016 and 2017 when a series of competitive tenders in Europe witnessed strike prices fall below USD 100/MWh,...

We introduce search unemployment à la Pissarides into Melitz’ (2003) model of trade with heterogeneous firms. We allow wages to be individually or collectively bargained and analytically solve for the equilibrium. We find that the selection effect of trade influences labor market outcomes....