Baqaee, David; Burstein, Ariel T.; Duprez, Cédric; … - National Bureau of Economic Research - 2023
We investigate the effects of input variety creation and destruction on both micro- and macroeconomic outcomes using detailed data from Belgium. We estimate that marginal costs rise by 0.6% for every 1% of suppliers lost. We show that this elasticity measures the area under the input demand...