Whether a firm is able to attract foreign capital and whether it may participate at the export market depends on whether the fixed costs associated with doing so are at least covered by the incremental operating profits. This paper provides evidence that success for some firms in attracting...

Global value chains have fundamentally transformed international trade and development in recent decades. We use matched firm-level customs and manufacturing survey data, together with Input-Output tables for China, to examine how Chinese firms position themselves in global production lines and...

This paper uses high-frequency data for publicly-listed Japanese manufacturing firms over the period 2000 to 2010 to show that a greater reliance on foreign market sales increases the conditional volatility of firms' stock returns. The two margins of global engagement we consider, namely,...

We develop a theoretical framework to explain firms' offshoring decisions in the presence of uncertainty. This model highlights the role of labor market institutions in shaping a firm's ability to effectively react upon future shocks, yielding a sharp prediction of the prevalence of offshoring...

Mexico experienced a tremendous expansion of its export-processing maquila sector during the 1990s. At the same time, a large proportion of its labor force remains employed in the informal sector. Since one of the main objectives of the maquiladora program was to increase formal employment, we...

We investigate the long-term effects of export opportunities to a large destination market on multinational affiliates and domestic firms in a low-income host country. The US-Vietnam Bilateral Trade Agreement reduced US import tariffs on exports from Vietnam. Tariff reductions led to entry...

In recent years, manufacturing firms in the United States have faced increasing import competition from low-wage countries, especially China. Does this competition hurt or help innovation by firms? This paper studies the effect of the surge in imports from China on innovation in the US...

This paper studies the life-cycle dynamics of exporters and multinational enterprises (MNEs). We present a dynamic model of trade and MNE activity in which the mode of serving a market depends on the well-known proximity-concentration tradeoff. We show that the option of performing MNE...