Foreign producer services can provide substantial benefits for domestic firms. We build on earlier monopolistic-competition models of intermediate producer services in this paper. Results show that: (1) while foreign services are partial-equilibrium substitutes for domestic skilled labour, they...

Empirical evidence of the impact of borders on international trade flows using the gravity equation approach abounds. This paper examines the empirical relevance of state borders in U.S. interstate trade for various specifications of the gravity equation. We find a large and economically...

In this paper, I use Canadian micro-data on individual workers to investigate the effect on wages of the tariff reductions mandated by the Canada-U.S. Free Trade Agreement (CUSFTA). The literature on industry wage premia has revealed that the industry of employment is an important determinant of...

We examine whether increased trade with countries with ineffective protection of intellectual property has contributed to the skill-deepening of the 1980s. We construct an index of effective protection of intellectual property at the country level, combining data on protection of patents and...

The recent microeconomic literature on international trade has highlighted the importance of firm characteristics and trade costs for exports. This study provides evidence on one type of those costs, the costs of doing business overseas, from a theoretical and empirical perspective. Controlling...

We investigate the impact of international outsourcing on productivity using plant-level data for Irish manufacturing. Specifically, we distinguish the effect of outsourcing of materials from services inputs. Moreover, we examine whether the impact on productivity is different for plants being...

The paper estimates the effects of the U.S. direct investment in Canada upon productivity in domestically owned plants. We distinguish between FDI in the industry of domestically controlled plants and FDI in the industries linked through supply or use of intermediate inputs. We find that an...

This paper examines firm heterogeneity in terms of size, wages, capital intensity, and productivity between domestic and foreign-owned firms that engage in intra-firm trade, firms that export and import, firms that import only, and firms that export only. As previously documented, heterogeneity...

We develop an open economy general equilibrium model, with auctionbased directed search unemployment, to study the interactions of trade and unemployment. The theory ascribes all outcomes purely to the fundamentals of technology and endowment. If countries differ by <i>endowment</i>, trade makes both...

We provide the first firm-level evidence of the impact of the trade in producer services (`offshoring') on the labour market. Using a new data set from the UK that measures trade in services at the firm level, we find no evidence that importing intermediate services is associated with job losses...