Fragmentation of the value-added-chain is modeled as the reaction of monopolistically competitive firms to the removal of barriers to trade and factor mobility in an integrated trading environment. Since fragmentation requires high-skilled labor, this form of globalization can induce labor...

We study how technology adoption and changes in global value chain (GVC) integration jointly affect labor shares and business function specialization in a sample of 14 manufacturing industries in 14 European countries in 1999-2011. Our main contribution is to highlight the indirect effect of...

We investigate differences in labor demand between German automotive firms specializing in green propulsion technology and those with a focus on combustion engines. To this end, we introduce a firm-level labor demand index based on the near-universe of online job postings and firms’ patent...

Many tasks can only be completed if several people contribute. Likewise, many institutions, e.g. voting rules, require the support of several people to implement specific decisions. In such situations, individual costs from supporting may decrease in the number of supporters. This holds true for...

We propose a quantitative framework for the analysis of industrialization in which specialization in manufacturing or agriculture is driven by comparative advantage and non-homothetic preferences. Countries are integrated through trade but trade is not costless and geographic position matters....

We develop a simple information-based model of FDI flows. On the one hand, the relative abundance of intangible capital in specialized industries in the source countries, which presumably generates expertise in screening investment projects in the host countries, enhances FDI flows. On the other...

In this paper, we construct an elaborate general equilibrium model with a continuum of production fragments for an intermediate good, then embed it in a growth model to address the effects of global production fragmentation, vertical specialization and trade on growth and inequality for a small...