To what extent a short-term decline in the output of a small open economy can be explained by trade barriers? To answer, we extend the standard four-wedge Business Cycle Accounting method of Chari et al. (2007) to a five-wedge small open economy model by adding a time-varying wedge that...

We estimate the price elasticity of the demand for gasoline smuggling in Iran. For this purpose, we employ a detailed panel of monthly gasoline consumption data from 160 distribution hubs during the period 2005-2014. We apply two different approaches which are diff-in-diff and panel data...

This paper is concerned about addressing a question that has become critical in international trade, during the past three decades: "What factors explain the worldwide increase in skill premiums following international trade integration and increasingly globalized economies"? I propose a new...

In this paper, we theoretically analyze the capital misallocation effect of financial repression---namely, a regulation to provide cheap loans to (public) firms, in less-developed economies. Limited contract enforcement and asymmetric information between lenders and borrowers are the features of...

In this paper we propose a theoretical model of international trade that shows the welfare gains from trade are much higher than what Arkolakis et al 2014 find. We use the idea of weak linkages and the complementarity between the intermediate goods as in Jones 2011. The idea is simple....