Recent theoretical models predict gains from international trade coming from intra-industryreallocations, due to a firm selection effect. In this paper we answer two related questions. First, whatis the magnitude of this selection effect, and how does it compare to that of intra-national trade...

We develop a model of commodity tax competition with monopolistically competitive internationallymobile firms, transport costs, and asymmetric country sizes. We investigate the impacts of noncooperativetax setting, as well as of tax harmonization and changes in the tax principle, in both...

We distill the main insights from recent trade models on firms responses to globalisation. Our primary aim is to assess the economic impact and the welfare implications of the resulting reallocation of resources across firms and countries. In sodoing, we bring theory into life through the...

We study the impact of transfer pricing rules on sales prices, firms’ organizational structure, andconsumers’ utility within a two-country monopolistic competition model featuring source-basedprofit taxes that differ across countries. Firms can either become multinationals, i.e., they serve...

We investigate the role of the transport sector in structuring the location of economic activitywithin two-region economic geography models of the footloose capital and core-peripherytypes. In our setting, competitive carriers offer transport services for shipping manufacturedgoods across...

We analyze the equilibrium and the optimal resource allocations in a monocentric city undermonopolistic competition. Unlike the constant elasticity of substitution (CES) case, wherethe equilibrium markups are independent of the city size, we present a variable elasticity ofsubstitution (VES)...

We characterize the equilibrium and optimal resource allocations in a general equilibrium model of monopolistic competition with multiple asymmetric sectors and heterogeneous firms. We first derive general results for additively separable preferences and general productivity distributions, and...