domestic welfare through two channels. First, by reducing export income volatility and allowing for a smoother consumption path … to borrow against future export income). Under plausibly calibrated parameters, the second channel may lead to much …

through two channels. First, by reducing export income volatility and allowing for a smoother consumption path. Second, by … against future export income). Under plausibly calibrated parameters, the second channel may lead to much larger welfare gains …

's producers to upgrade the quality of the goods that they export. The paper first documents two stylized facts regarding the … effect of trade liberalization on export prices and its relation with product differentiation. Next, the paper develops a … raise its export price in industries where the scope for quality differentiation is large while to lower its export price in …