This paper shows that electoral incentives deter politicians from supporting trade liberalization. We focus on all major trade liberalization bills introduced since the early 1970s in the U.S. Congress, in which House and Senate members serve respectively two- and six-year terms and one third of...

We use 6-digit bilateral trade data to document the effect of WTO/GATT membership on the extensive and intensive product margins of trade. We construct gravity equations for the two product margins motivated by Chaney (2008). The empirical results show that standard gravity variables provide...

The literature on knowledge diffusion shows that knowledge decays strongly with distance. In this paper we document that the probability that a product is added to a country's export basket is, on average, 65% larger if a neighboring country is a successful exporter of that same product. For...

Quantitative results from a large class of structural gravity models of international trade depend critically on the elasticity of trade with respect to trade frictions. We develop a new simulated method of moments estimator to estimate this elasticity from disaggregate price and trade-flow data...

Exporting firms do not only decide how much of their products they ship abroad but also at which frequency. Doing so, they face a trade-off between saving on fixed costs per shipments (by shipping large amounts infrequently) and saving on storage costs (by delivering just in time with small and...

We provide a model of product-based cultural change where trade integration leads to cultural convergence. A standard trade model of Dixit–Stiglitz monopolistic competition is coupled with a micro-founded model of cultural dynamics. We show that access to varieties that are attached to a...

The theory of the firm suggests that firms can respond to poor contract enforcement by vertically integrating their production process. The purpose of this paper is to examine whether firms' integration opportunities affect the way contract enforcement institutions determine international trade...

Our knowledge of the trade effects of domestic infrastructure is very limited. The reason is twofold. First, data needed to examine these effects are not readily available. Second, identifying such effects requires properly addressing potential endogeneity problems affecting the relationship...

This paper extends the literature on trade liberalization and firm productivity (TFP) by examining the complementarities between the speed of contract enforcement and the productivity gains from input tariff liberalization. It does so by using firm-level panel data from India along with an...

This paper introduces idiosyncratic firm efficiency shocks into a continuous-time general equilibrium model of trade with heterogeneous firms. The presence of sunk export entry costs and efficiency uncertainty gives rise to hysteresis in export market participation. A firm will enter into the...