This study proposes a "Flexible Cost Model" (FCM) for settings in which firms may be unable or unwilling to optimally manage their cost structures. FCM, which nests a wide range of more restrictive models, allows for a flexible specification not only of the technology but also of firm-level...

The paper reports the empirical results of the validation of the Stochastic Production Frontier (SPF) Model to an unbalanced panel comprising a cross-section of 8 manufacturing industries over a time span of 26 years The results provide insights on the repercussions of the micro-economic reform...

In order to simplify the representation of a technological relationship between inputs and outputs, a production unit's technology must typically satisfy some restrictive conditions, some of them being well known in the literature. This paper presents new results for aggregating labour inputs...

This paper studies the aggregate substitution and expansion effects triggered by changes in input prices, in a context where firms supply a homogenous commodity and compete in quantities à la Cournot. We derive a sufficient condition for the existence of a Cournot equilibrium and show that this...

The paper analyses the effects of the 1990 Brazilian trade liberalizaton on the total factor productivity, market share and profits of a sample of 318 large manufacturing firms. A panel data production function analysis for the period 1986/94 indicates very large total factor productivity gains...

Following along the lines of a growing literature on the causal link between exporting and productivity this paper analyzes the existence of learning-by-exporting in Slovenian manufacturing between 1994 and 2002. This paper asks whether in addition to good firms self-selecting into exports and...

I illustrate that the welfare improvement property of the Melitz model is due to the shape of the aggregate labor demand curve, which slopes upwards. By slightly changing some assumptions in the model, this curve may have a negative slope. In this case, increases in aggregate productivity result...

Arkolakis, Costinot and Rodriguez-Clare (ACR, 2012) prove that, conditional on the change in openness, the welfare gains from foreign trade reforms are quantitatively identical across single-sector trade models with radically different micro-foundations. We generalize this result to domestic and...