Using rich data on the international transactions of intermediate inputs by French firms we investigate the determinants of the choice between vertical integration and outsourcing at the international level. Our results show that the probability of vertical integration is reduced by the extent...

In this paper I develop a model of international duopoly, where firms invest in product differentiation. I show that firms have an incentive to free-ride on the investment of their rival, due to an externality generated by product differentiation. A further effect of product differentiation is...

This paper analyses to what extent working conditions in foreign-owned firms differ from those in their domestic counterparts. It makes three main contributions. First, we replicate the consensus in the empirical literature by applying a standardised methodology to firm-level data for three...

Despite the importance of international trade on intermediate goods, the literature did not pay much attention to this aspect in determining the effects of trade liberalisation in the presence of labour unions. We take up this issue here and show the effects of trade liberalisation on the final...

We offer a new perspective to the unionised wage effects of unilateral trade liberalisation by considering endogenous domestic market structure. Hence, in contrast to the existing works, which focus on the short-run effects of trade liberalisation on unionised wage, we focus on more long-run...

The issue of economic governance is highly discussed pertaining to the question of industrialisation of a country, but the literature on trade and foreign direct investment (FDI) hardly pays attention to this aspect. We develop a simple model to show how better governance affects inward FDI and...

We show the welfare effects of international trade cost reduction under endogenous domestic market structure. If the domestic labour market is competitive, there is no integer constraint and the trade cost represents transportation cost, a reduction in the transportation cost does not affect...

This paper analyzes the effects of cross-border mergers and acquisitions (M&As) on the innovation of European firms. The results indicate a considerable increase in post-acquisition innovation in the merged entity. This is mainly driven by inventors based in the acquirer's country, while...

We introduce financial frictions into a simple two sector model of international trade with heterogeneous agents and investigate the impact of differences in the strength of financial institutions and wealth inequality on trade flows, capital movements and entrepreneurial migration. Distinct...

Opposing theoretical predictions on the effects of trade preferences on multilateral tariff cuts point to the need for empirical analysis to determine whether preferential trade agreements promote or hinder multilateral trade liberalization. This paper examines the impact of Japan’s trade...