We study how increased import competition affects the evolution of productivity in a small open economy. We use a production survey of Belgian firms where we observe quarterly firm-product data at the 8-digit level on value and quantities sold together with firm-level labor, capital, and...

We propose a new model of multi-product firms in international trade, where firms choose their product mix based on the products’ attractiveness and endogenous competition. The model is motivated by two novel stylized facts using Danish manufacturing data, which demonstrate the importance of...