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in the effect and size of productivity shocks explain most of the gap in misallocation between manufacturing and services …, while the remainder is explained by differences in firm productivity and age distribution. We interpret these results as …
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Services, which are less traded than goods, rose from 50 percent of world expenditure in 1970 to 80 percent in 2015. Such structural change restrained "openness"—the ratio of world trade to world GDP—over this period. We quantify this with a general equilibrium trade model...
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