Applying auction theory to the toxic-asset rescue plan currently released by theUnited States Treasury Department, this paper demonstrates an equilibrium wheremoderately poor bidders outbid rich bidders in such auctions. After defeating theirrich rivals and acquiring the toxic assets, such...

We develop a model with one innovating northern firm and heterogeneous southernfirms that compete in a final product market. We assume southern firms differ in their intrinsiccosts and their ability to adapt technology and study southern incentives to protect intellectualproperty rights. We find...

We develop a model with one innovating northern firm and several heterogeneousSouthern firms that compete in a final product market. We assume the southern firms differ intheir ability to adapt technology and use this heterogeneity to study the differing incentives ofsouthern governments to...

This paper compares the welfare under two standard alternative exchange rate regimes, fixed andflexible, in a stochastic dynamic general equilibrium two-country setting. Conventional wisdomholds that countries often prefer low exchange-rate variability to stabilize trade. This may explainthe...

We analyze the trade and welfare impact of quarantine measures imposed by Australiaon imports of pigmeat. In particular, we account for changes to Australia’s pigmeat quarantinepolicy over time including those changes related to the recent resolution of a WTO disputebetween Australia and the...

We investigate the eect of cap-and-trade regulation of CO2 on rm prots byperforming an event study of a CO2 price crash in the EU market. We examinereturns for 90 stocks from carbon intensive industries and 600 stocks in the broadEUROSTOXX index. Firms in carbon intensive, or electricity...

This paper provides a systematic welfare-based approach to analyze the impact of non-tariffmeasures (NTMs) on trade and welfare in presence of market imperfections. We focus onstandard-like measures such as technical barriers and sanitary and phytosanitary regulations.The approach overcomes the...

The allocation or assignment of emissions allowances is among the most con-tentious elements of the design of emissions trading systems. Policy-makers usuallytry to satisfy a range of goals through the allocation process, including easing thetransition costs for high-emissions rms, reducing...

Exports of agricultural commodities to developed countries play a significant role inthe economies of many developing countries. The elimination of import tariffs has the potentialto benefit producers in the developing countries, but estimates of the effect of trade liberalizationtypically...