We extend structural gravity models of bilateral trade flows to oligopolistic competition. We show that conventional … gravity estimates do not only reflect trade costs but also market power. Our simple estimation procedure generalizes the … standard gravity model and disentangles exogenous trade frictions and endogenous market power distortions. We use our estimated …

This paper revisits the relationship between international trade and economic growth. We measure trade openness indices … in explaining growth gains from trade. Using sectoral level data from WORLD KLEMS Database on industrial productivity and … output and global input output tables to construct the measures of trade openness, our empirical analysis covering 21 …

. Owing to this linkage, trade cost reductions induce cartel members to adjust their sales, not only due to direct effects …, but also due to spillover effects related to cartel discipline. We apply these ideas to preferential trade agreements … (PTAs) and show that the indirect effects can give rise to trade diversion. We also characterize the welfare effects of …

international trade is the use of quantitative trade models to estimate the economic welfare losses from dissolutions of major … countries' economic integration agreements (EIAs). In 2016, "Brexit" was passed in a United Kingdom referendum. Moreover, in … 2019, the existence of the entire North American Free Trade Agreement (NAFTA) is at risk if the United States withdraws - a …

We examine how trade openness influences income inequality within countries. The sample includes 139 countries over the … period 1970-2014. We employ predicted openness as instrument to deal with the endogeneity of trade openness. The effect of … trade openness on income inequality differs across countries. Trade openness tends to disproportionately benefit the …

In this paper, we develop a network perspective on the welfare gains from trade in today’s internationally fragmented … supply chains. Towards this end, we study a Ricardian trade model featuring trade in final and intermediate products, and … introduce a novel comparative statics approach to decompose the total welfare effects of an arbitrary trade cost shock into …

show that, although international trade in a static setting in the wage fund framework has real asymmetric distributional … nullified in the dynamic setting. In fact, trade liberalization is Pareto improving along the balanced growth path …

We use a quantitative model to study the implications of European integration for welfare and migration flows across 1 …,318 regions. The model suggests that an increase of trade barriers to the level of 1957 reduces welfare by about 1-2 percent on … average, depending on the presumed trade elasticity. However, remote regions may face initial welfare losses of up to 4 …