currency choice. We show that although monetary policy is less efficient and cannot implement the flexible-price allocation … monetary stance of the U.S. In spite of the aggregate demand externality, capital controls cannot unilaterally improve the … rest of the world. International cooperation benefits other countries by improving global demand for dollar-invoiced goods …

-entry dynamics of quantities, but no post-entry dynamics of markups. This suggests that shifts in demand play an important role in … successful entry, but that firms do not use dynamic manipulation of markups as an instrument to shift demand. We structurally … advertising to acquire new customers and thereby shift demand and increase sales. In the second, they use temporarily low markups …