We develop a two-country, two-good, and two-factor model of international trade in which one of the sectors is perfectly competitive and the other one is oligopolistic. The oligopoly sector consists of a given number of identical firms for each country, but they are free to locate in any of the...

This paper estimates a two-country model with a global bank, using US and Euro Area (EA) data, and Bayesian methods. The estimated model matches key US and EA business cycle statistics. Empirically, a model version with a bank capital requirement outperforms a structure without such a...