We study the welfare impact of rules of origin in free trade agreements where final-good producers source customized inputs from suppliers within the trading bloc. We employ a property-rights framework that features hold-up problems in suppliers’ decisions to invest, and where underinvestment...

This paper sets up a model of trade, in which two countries with differing levels of technology specialize in the production of sub-stages of the global value chain. In the open economy, the technologically backward country exports intermediates in exchange for imports of a homogeneous...

We study the role of firms in the political economy of trade agreements. Using detailed information from lobbying reports filed under the Lobbying Disclosure Act, we find that virtually all firms that lobby on free trade agreements (FTAs) support their ratification. Moreover, relative to...

Per Magnus Wijkman was the first foreign observer to urge Iceland in print to regulate its fisheries by price. This was in 1975, nine years before the Icelandic fishing quota system came into effect, a system judged discriminatory and unconstitutional by the Supreme Court of Iceland in 1998 (but...

While traditional empirical models using determinants like size and trade costs are able to predict RTA formation reasonably well, we demonstrate that allowing for machine detected non-linear patterns helps to improve the predictive power of RTA formation substantially. We employ machine...

Can trade agreements motivate environmental conservation? I first present a model whereby the government in the South expands its production capacity (e.g., deforest) before trading with the North. After deriving negative relationships between tariff reductions and conservation, I show how all...

The global success of online search engines and social media is due to their free access and high level of quality. However, these features are supported by a business model that exploits personal user data to provide targeted advertising services to third parties. Does this business model...

In light of the recent tit-for-tat trade dispute between China and the US, interest in quantifying the effects of the so-called phase one agreement has risen. To this end, the paper quantifies the impact of the asymmetric managed trade agreement using such a multi-country open-economy dynamic...

We challenge the common practice of estimating gravity equations with time-interval data in order to capture dynamic-adjustment effects to trade-policy changes. Instead, we point to a series of advantages of using consecutive-year data recognizing dynamic-adjustment effects. Our analysis reveals...