There are enormous differences across firms and their impact on the macroeconomy. Using unique administrative data from Portugal, enabling us to link companies to their owners, we show that firms owned by serial entrepreneurs (owners of multiple businesses) enjoy a "premium" along many...

We develop a parsimonious model of innovating firms rich enough to confront firm-level evidence. It captures the dynamic behaviour of individual heterogeneous firms, describes the evolution of an industry with simultaneous entry and exit, and delivers a general equilibrium model of technological...

We provide new evidence that large firms or establishments are more sensitive than small ones to business cycle conditions. Larger employers shed proportionally more jobs in recessions and create more of their new jobs late in expansions, both in gross and net terms. The differential growth rate...

This paper presents a dynamic model that analyzes how firms’ expectations with regards to technological change influence the demand for outsourcing. We show that outsourcing becomes more beneficial to the firm when technology is changing rapidly. As the pace of innovations in production...

This paper explores the combined effects of reductions in trade frictions, tariffs, and firing costs on firm dynamics, job turnover, and wage distributions. It uses establishment-level data from Colombia to estimate an open economy dynamic model that links trade to job flows in a new way. The...

Labour market regulations have often being blamed for high and persistent unemployment in Europe, but evidence on their impact remains mixed. More recently, attention has turned to the impact of product market regulations on employment growth. This Paper analyses how labour and product market...

Preventives are sold ex ante, before disease status is realized, while treatments are sold ex post. Even if the mean of the ex ante distribution of consumer values is the same as that ex post, the shape of the distributions may differ, generating a difference between the surplus each product can...

While innovation is argued to create value, private incentives of firms to innovate are driven by what part of the value created firms can appropriate. In this paper we explore the relation between innovation and the markups a firm is able to extract after innovating. We estimate firm-specific...

This study shows that preemptive investment in product proliferation is subject to a commitment problem that is not constrained to models of horizontal product differentiation, but applies to vertical product differentiation settings as well. We investigate the incentives of firms producing...

We compare the social welfare generated by a domestic government in two types of policy set-ups: a ‘commitment’ regime in which government sets its policy instrument before the strategic choice by a domestic firm and a ‘non-commitment’ regime where the policy variable is set after the...