From 1997 to 2008, Texas shipped 40 percent of its manufacturing exports to Mexico. This puts Texas-Mexico among the largest state-country trading relationships. But this share has been declining recently. A gravity equation cannot account for either of these facts, even though Texas and Mexico...

Because of more restrictive assumptions on regional input-output (IO) models compared to computable general equilibrium (CGE) models, IO results are thought to be consistent with long-run equilibrium but otherwise overestimated. We compare IO and CGE models' response to a shock to Washington...

Deardorff's (2004) broad definition of technology in Ricardian trade models is useful for extending the explanatory power of comparative advantage to account for a fact on firm level exporter clustering unexplained under the standard definition.

Forty US states operated an overseas office in 2002. Treating overseas offices as sales offices, the model assumes offices facilitate exports by reducing the transaction cost of selling abroad. From theory, states operate an office if aggregate savings outweigh operating costs. Exploiting the...