This paper examines the effect of volatility on the costs and benefits of financial market integration. The basic … foreign banks, characterized by lower costs of intermediation and a lower markup rate, have free access to domestic capital …

of the Tiebout hypothesis using historical variation in mobility costs. Our extension of the Tiebout model to incorporate … such costs yields the following comparative statics: as mobility costs fall, the heterogeneity across communities of … mobility costs have fallen over time, a natural test of the Tiebout hypothesis is to take these predictions to the data here …

costs, where the future terms of trade are random. Allowing time dependent transportation costs adds a dimension of … in countries characterized by low terms of trade volatility and low financing costs. In these circumstances, imports are … pre-bought, and the spot market for imports is inactive. In countries where the financing costs and the terms of trade …