In the standard heterogeneous firm model of Hopenhayn (1992) and Melitz (2003), more efficient firms export and trade liberalization leads to higher average efficiency among firms. In data for Columbian plants 1981–1991, we see that the average level of productivity among exporters is...

Quantifying the gains from international trade is an area of research that has been widely studied using a variety of trade models. At the same time, it has been shown that non-homotheticities are useful for matching the systematic patterns of trade present in disaggregated trade data. We bring...

A recent empirical literature has documented that credit availability is a significant barrier for firm-level exports. We develop a dynamic general equilibrium trade model with heterogeneous monopolistic competitive firms and imperfect credit markets due to limited contract enforceability. We...