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We derive a simple equation for the welfare gains from trade when tariffs are liberalized or iceberg trade costs fall. Covering various one-sector trade models that may or may not feature extensive margins and imperfect competition, we generalize the analysis of Arkolakis, Costinot and...
Persistent link: https://www.econbiz.de/10010344632
Borders have a sizable negative impact on trade flows. Given the vast number of individual goods potentially traded, this "border effect" could have two possible explanations: (1) less international than domestic trade in the goods that are actually traded between countries ("flow"), or (2)...
Persistent link: https://www.econbiz.de/10001591415
In this paper, we establish the importance of experience in international trade in reducing unmeasured trade costs and facilitating bilateral trade. We find a strong role for experience, measured in years of positive trade, for both aggregate and sectoral bilateral trade. In an augmented gravity...
Persistent link: https://www.econbiz.de/10014048689
In this paper, we establish the importance of experience in international trade in reducing unmeasured trade costs and facilitating bilateral trade. We find a strong role for experience, measured in years of positive trade, for both aggregate and sectoral bilateral trade. In an augmented gravity...
Persistent link: https://www.econbiz.de/10013250489
Gravity estimation based on sector-level trade data is generally misspecified because it ignores the role of product-level comparative advantage in shaping the effects of trade barriers on sector-level trade flows. Using a model that allows for arbitrary patterns of product-level comparative...
Persistent link: https://www.econbiz.de/10012963443
We review a recent body of theoretical work that aims to put numbers on the consequences of globalization. A unifying theme of our survey is methodological. We rely on gravity models and demonstrate how they can be used for counterfactual analysis. We highlight how various economic...
Persistent link: https://www.econbiz.de/10014025382
Trade is measured on a gross sales basis while GDP is measured on a net sales basis, i.e. value added. The rapid internationalization of production in the last two decades has meant that gross trade flows are increasingly unrepresentative of value added flows. This fact has important...
Persistent link: https://www.econbiz.de/10013118685
The purpose of this paper is to explain the relation between the Border Effect and industrial concentration. This is achieved by founding this relation on the Home Market Effect and testing the robustness of this foundation through an application to the European Single Market. A sectorial...
Persistent link: https://www.econbiz.de/10003969243
Trade is measured on a gross sales basis while GDP is measured on a net sales basis, i.e. value added. The rapid internationalisation of production in the last two decades has meant that gross trade flows are increasingly unrepresentative of value added flows. This fact has important...
Persistent link: https://www.econbiz.de/10009380892
This chapter discusses whether and how 'new quantitative trade models' (NQTMs) can be fruitfully applied to quantify the welfare effects of trade liberalization, thus shedding light on the trade-related effects of further European integration. On the one hand, it argues that NQTMs have indeed...
Persistent link: https://www.econbiz.de/10010411278