Trade Policy under Firm-Level Heterogeneity in a Small Economy

As a large body of trade research has found, high productivity firms are more likely than low productivity firms to engage foreign markets; this division of capabilities

The important result is as follows: inflow of foreign capital with full repatriation of its earnings is necessarily immiserizing (i.e. welfare worsening) if the

liberalization in the form of foreign health capital inflow on the price of health.. commodity, returns to the various inputs and on welfare in a

The key difference is that expanding the domestic MC sector now reduces the number of foreign firms that select to supply imports (  ˆ M  0 , equation 4’) so welfare

These explanatory variables are used to proxy for political economy characteristics: change in imports is a proxy for import penetration (which we cannot measure directly due to

To illustrate this point, we simulate the relationship between foreign demand and initial productivity of …rms, for two di¤erent levels of variable trade costs. In the plot, the

This papers explores the effects of transport costs, tariffs, and foreign wage rates on the domestic economy in the presence of reverse imports, with special emphasis on inter-firm

Rather than diverting trade away from other markets as predicted in settings without fixed industry entry costs, preferences given by one developed country can significantly raise