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% for the EU, by .5% for the United States, and by -.02% for the rest of the world relative to the status quo. However …
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Does trade openness cause higher GDP per capita? Since the seminal instrumental variables (IV) estimates of Frankel and Romer [F&R](1999) important doubts have surfaced. Is the correlation spurious and driven by omitted geographical and institutional variables? In this paper, we generalize F&R's...
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hypothesis and strengthens the role of non-homothetic preferences in trade theory. …
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