This paper quantifies the origins of firm size heterogeneity when firms are interconnected in a production network. Using the universe of buyer-supplier relationships in Belgium, the paper develops a set of stylized facts that motivate a model in which firms buy inputs from upstream suppliers...

This paper evaluates the impact of idiosyncratic productivity shocks to individual firms on aggregate output. Two sources of firm-level heterogeneity contribute to aggregate fluctuations: (i) asymmetries in supplier-buyer relationships and (ii) the skewed distribution of sales to final demand....

This paper presents the Belgian inter-firm network for the years 2002 to 2012. Combining raw data from VAT listings, VAT declarations and annual accounts information, we build a unique and consistent database containing values of transactions between enterprises in the Belgian economy. The...

This paper studies the implications of imperfect competition in firm-to-firm trade. Using a dataset on all transactions between Belgian firms, we find that firms charge higher markups if they have higher input shares among their buyers. We interpret this as firms competing as oligopolies to...

This paper compares various estimation techniques used to determine the impact of distance and borders on international trade. The results consistently confirm the significantly negative distance effect, while the border effect, measured by evaluating whether intra-continental trade exceeds...

We develop a quantitative framework in which income inequality arises endogenously in response to productivity shocks. The framework accommodates sectoral inputoutput linkages, arbitrary elasticities of factors and intermediates, and heterogeneous workers that endogenously choose to supply their...

We use detailed information on all real estate stock and transactions since 2006 to study housing inequality in Belgium and how a recent policy shaped it. We use the transactions to predict the market value of all dwellings in the country, to then estimate inequality in value or space at...

This paper compares various estimation methods often used in the estimation of gravity models of international trade. The authors first discuss different structural and consistent estimation techniques, their underlying assumptions and their impact on estimated coefficients. They then estimate...

This paper evaluates how firms change their prices in response to cost shocks and other price changes in their environment. We first document three new facts on the heterogeneity of firm-level producer prices and their relationship to buyers and suppliers in a production network. We then develop...

The fragmentation of production across borders allows firms to make and export final goods, or to perform only intermediate stages of production by processing imported inputs for re-exporting. We examine how financial frictions affect companies’ choice between processing and ordinary trade –...