escalation. Yet neoclassical trade theory - and modern Ricardian trade models, in particular - predict that welfare … tariff escalation increasing in the extent of downstream returns to scale. A quantitative evaluation of the US-China trade …

Multinational firms (MNEs) dominate trade flows, yet their global production decisions are often ignored in firm …-level studies of exporting and importing. Using newly merged data on US firms' trade and multinational activity by country, we show … that MNEs are more likely to trade not only with countries in which they have affiliates, but also with other countries …

productivity and country-specific variables. In contrast to canonical export models where firm profits are additively separable … generate heterogeneous domestic sourcing responses to trade shocks …

Multinational firms (MNEs) accounted for 42 percent of US manufacturing employment, 87 percent of US imports, and 84 of … US exports in 2007. Despite their disproportionate share of global trade, MNEs' input sourcing and final-good production … decisions are often studied separately. Using newly merged data on firms' trade and FDI activity by country, we show that US …

This paper develops a framework to study the interplay between world trade and interest rates. The model incorporates … the response of the volume of world trade to changes in the interest rate into four components: (i) a labor productivity … effect, (ii) a propensity to consume out of labor income effect, (iii) a temporal dimension of variable trade costs effect …

processes, higher labor productivity, and higher wages. In a free trade equilibrium, countries with lower interest rates … specialize in relatively 'time intensive' stages in global value chains (GVCs). Yet, if free trade brings about interest rate … equalization, wages are also equalized and the pattern of trade is instead shaped by capital intensity and capital abundance …

We develop a model of export-platform foreign direct investment (FDI) in which final goods are produced only with labor …

-product firms live forever, and the large firms invest in innovation in order to enlarge their product spans. All firms export. I …

We study unanticipated tariffs on imports of intermediate goods in a setting with firm-to-firm supply relationships … free trade. Once they are in place, the home government surprises with an input tariff. This can lead to renegotiation with … deterioration in the terms of trade. The welfare implications of a tariff are ambiguous in this second-best setting, but plausible …