This paper assesses the quantitative importance of including sectoral heterogeneity in computing the gains from trade. Our framework draws from Caliendo and Parro (2015) and has sectoral heterogeneity along five dimensions, including the elasticity of trade to trade costs. We estimate the...

As countries strive for a strong recovery and to recoup the losses incurred during the COVID-19 pandemic, they need to map out a new path for development and high and sustained growth. Promoting diversification, developing new industrial capabilities, and designing the policies needed to achieve...

In this paper we present an endogenous growth model with physical and human capital accumulation and study the effects of labor and capital income taxation on the transitional dynamics to the balanced path. Our results amount to an extension of those in Caball\'{e} and Santos (1993) and offer...

This paper uses a recent demogrant for the elderly in Mexico City to estimate the e¤ect of an exogenous increase in the income of older individuals on the amount of private transfers they receive. My results show that not controlling for the endogeneity of income replicates the positive or...

We construct an intertemporal equilibrium with two agents with heterogeneous beliefs. Heterogeneity of beliefs induces volatility of the interest rate. We study the effect of financial innovation on interest rate volatility and conclude that, in a setting of asymmetric beliefs, introducing the...

This essay lists theoretical reasons why neoclassical models of one-sector growth imply that nations with identical economic structures need not converge to the same steady state or balanced growth path, and outlines the empirical significance and policy implications of conditional...

We build a partial equilibrium model of firm dynamics under exchange rate uncertainty. Firms face idiosyncratic productivity shocks and observe the current level of the real exchange rate each period. Given their current level of capital stock, firms make their export decisions and choose how...

It is argued that migration from Mexico to the US and return migration are determined by international wage differentials and preferences for origin. We use a model of job search, savings and migration to show that job turnover is a crucial determinant of the migration process. We estimate this...

In this paper we consider a sequential trading economy with incomplete financial markets and a finite number of infinitely lived agents. We propose a specification of agents' budget sets and show that such specification features several desirable properties. We then establish the existence of an...

We provide a framework to evaluate whether or not a seller can increase his revenue in interacting with a privately informed buyer by using money-back guarantees (MBGs). The buyer's value for the good exhibits fi risk and his type is multidimensional giving the probability of Öt as well as the...