Seidel, Tobias; von Ehrlich, Maximilian - Verein für Socialpolitik - VfS - 2013
We develop a heterogeneous-fi rms model with trade in goods, labor mobility and credit constraints due to moral hazard. Mitigating fi nancial frictions reduces the incentive of high-skilled workers to migrate to one region such that an unequal distribution of industrial activity becomes less...