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Subsidizing firm entry in open economies
Pflüger, Michael; Südekum, Jens - 2009
Entrepreneurs who decide to enter an industry are faced with different levels of effective entry costs in different countries. These costs are heavily influenced by economic policy. What is not well understood is how international trade affects the government incentive to impact on entry costs,...
Persistent link: https://www.econbiz.de/10010271259
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Heterogeneous firms, trade, and economic policy: Insights from a simple two-sector model
Pflüger, Michael; Russek, Stephan - 2011
The robust empirical finding that exporting firms are systematically different from firms that merely serve domestic consumers has inspired the development of a new brand of trade theory, the theory of heterogeneous firms and trade. The establishment of a canonical model due to Melitz (2003) has...
Persistent link: https://www.econbiz.de/10010286896
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Economic Integration, Wage Policies and Social Policies
Pflüger, Michael - 2003
This paper uses a two country trade and geography model of monopolistic competition to study the effects of wage policies and social policies on the location of industry. It is first shown that a union wage push in one of two otherwise identical countries induces a relocation of firms which...
Persistent link: https://www.econbiz.de/10010262711
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Business conditions and default risks across countries
Pflüger, Michael P.; Russek, Stephan - 2011
The risk of default that business firms face is very significant and differs widely across countries. This paper explores the links between countries' business conditions and international trade embedment and the default risk at the country level from a theoretical point of view. Our main...
Persistent link: https://www.econbiz.de/10010278811
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On Trade Policy Preference and Offshoring Ties
Bandyopadhyay, Subhayu; Basu, Arnab K.; Chau, Nancy H.; … - 2022
This paper unpacks the role of the domestic content of imports as a novel source of policy interdependence along the global supply chain. We show how a rise in local contents embodied in imports can skew national trade policy preferences, and pull upstream and downstream countries in asymmetric...
Persistent link: https://www.econbiz.de/10014296526
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Occupational choice, aggregate productivity, and trade
Meckl, Jürgen; Weigert, Benjamin - 2011
We propose occupational decisions of heterogeneous individuals as an alternative mechanism of explaining the distribution of firm productivities emphasized by empirical studies. Thus, we integrate the frameworks of Melitz (2003), and of Manasse and Turrini (2001) that establish the theoretical...
Persistent link: https://www.econbiz.de/10010278813
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Greasing the wheels of international commerce: how services facilitate firms' international sourcing
Debaere, Peter; Görg, Holger; Raff, Horst - 2010
We use unique plant-level data to study the link between the local availability of services and the decision of manufacturing firms to source materials from abroad. To guide our empirical analysis we develop a monopolistic-competition model of the materials sourcing decisions of heterogeneous...
Persistent link: https://www.econbiz.de/10010277455
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Small state regional cooperation, South-South and South-North migration, and international trade
Schiff, Maurice - 2010
This paper provides a different basis than previous analyses for regional bloc formation and regional migration. Due to low bargaining power and fixed costs, small states face a severe disadvantage in negotiations with the rest of the world and might benefit by forming a regional bloc. The study...
Persistent link: https://www.econbiz.de/10010269875
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Offshoring and unemployment: the role of search frictions and labor mobility
Mitra, Devashish; Ranjan, Priya - 2009
unemployment decreases upon offshoring in the presence of perfect intersectoral labor mobility. If, as a result, labor moves to the … intersectoral labor mobility, unemployment in the offshoring sector can rise, with an unambiguous unemployment reduction in the non-offshoring …
Persistent link: https://www.econbiz.de/10010269045
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Search and offshoring in the presence of animal spirits
Mitra, Devashish; Ranjan, Priya - 2009
decreases. Next we allow for offshoring of unskilled jobs in our model, and we find that, as a result, it becomes more likely … that the fair-wage constraint binds. Offshoring of unskilled jobs always leads to an increase in skilled wage, a decrease … adverse impact of offshoring on unskilled unemployment. The unskilled wage can increase or decrease as a result of offshoring. …
Persistent link: https://www.econbiz.de/10010269135