This study provides evidence that the over-export of grains aggravated the severity of China's Great Famine. We collect county-level data for the 1953-1965 period on death rates, birth rates, amounts of grain procured, output of different types of grain, crop productivity, weather conditions,...

This paper studies the causal effect of technology and knowledge transfers on early industrial development. Between 1950 and 1957, the Soviet Union supported the "156 Projects" in China for building technologically advanced industrial facilities. We exploit idiosyncratic delays in project...

We study the effect of exposure to communism (EC), a political-economic regime based on collectivist planning, on preferences for family supports, which we refer to as "informal family insurance". We exploit both cross-country and cohort variation in EC in a large sample of Central and Eastern...

Standard economics omits the role of narratives (the stories that people tell themselves and others) when they make all kinds of decisions. Narratives play a role in understanding the environment; focusing attention; predicting events; motivating action; assigning social roles and identities;...

Recent theoretical research shows that exporters are more productive than nonexporters. We show that this result holds almost trivially for the case of constant marginal cost of production, as mainly assumed in the literature, but it may not hold true if the marginal cost is not constant. Our...

This paper provides a novel justification for a declining time profile of unemployment benefits that does not rely on moral hazard or consumption-smoothing considerations. We consider a simple search environment with homogeneous workers and low- and high-productivity firms. By introducing a...

Recent trade theory in the Krugman (1980) tradition predicts that countries with larger market size enjoy higher levels of total factor productivity (TFP) - and equivalently of real per capita income or welfare - as a smaller fraction of spending on inputs is affected by trade costs. However, in...

This paper analyses an open economy Ramsey model with an endogenous labour supply without capital. The technology defines an optimal firm size. Changes to the number of firms is subject to adjustment costs, so that the entry dynamics is determined endogenously. We find that there is a short run...

We present a factor-proportions trade model in which heterogeneous firms can offshore intermediate inputs subject to fixed offshoring costs. In the skill-abundant country, high-productivity firms offshore a larger range of labor-intensive inputs to the labor-abundant countries than...

A political miracle occurred when Germany was reunited, and at first glance an economic miracle has followed. Real incomes in the east have now reached the western level, and investment per capita has been much higher than in the w est. However, every third deutschmark spent in the east has been...