We present a unified dynamic framework to study the interconnections between international trade and business cycle … externalities and dynamic trade models that feature monopolistic competition, endogenous entry, and heterogeneous firms. The … that the model is isomorphic to dynamic trade models that embody love-of-variety and selection effects. In a quantitative …

large parts of the world. In this paper we explore the financial and the trade channel in a unified framework and quantify … losses in the value of cross-border asset holdings. Calibrated to German data, the model predicts the trade channel to be …. The transmission via the financial channel triggers a much longer-lasting recession relative to the trade channel …

industrialized countries over the period 1978-2007. In recent decades, trade integration between advanced economies increased rapidly … share of less correlated sectors in GDP. Globalization - trend reductions in trade costs - exerts two opposing effects on … cross-border GDP comovement. On the one hand, greater trade linkages increase international transmission of shocks and …

, transmission channel originates in the interplay between financial integration and terms of trade movements in response to the …

export growth. However, FDI seems to stabilize exports during the crisis while reaping its own benefits in all times ….With recent data from OECD countries, our new approach regarding FDI openness and diversification is introduced to draw some … important policy implications for stability in export growth, and thus to economy.First, an economy more open to FDI is stronger …

this reactivity is not conditioned by trade and investment agreements, it must be qualified with respect to the type of FDI … FDI between two countries increases with source GDP instability and with host GDP stability. We also find that although … differential, the incidence of vertical FDI thus tends to be higher when uncertainty is high than when uncertainty is low …