While FTA negotiations are proliferating, our paper shows that targeting the appropriate sector is crucial for generating employment opportunities subsequent to FTA. In particular, we show that, countering conventional wisdom, targeting skill-biased exports and not the sector that employs...

While FTA negotiations are proliferating, our paper shows that targeting the appropriate sector is crucial for generating employment opportunities subsequent to FTA. In particular, we show that, countering conventional wisdom, targeting skill-biased exports and not the sector that employs...

There is widespread concern that climate policy is moving too slowly and that decarbonization of economic development is coming too late for effective climate protection. We analyze three different effects that emerge endogenously during decarbonization and amplify current policies: growing...

We build a general equilibrium model of endogenous communication, quality control and trade. We derive a structural gravity equation from the model and show that exogenous communication costs raise the costs of quality control and have a larger impact on products with a lower elasticity of...

We develop a dynamic general equilibrium model to quantify the interaction between climate policy, industry dynamics, and the elasticity of substitution between clean and dirty energy in the economy. The model incorporates empirical observations that firms differ substantially in their potential...

Motivated by the European Union's debate on sanctioning crude oil imports from Russia, we estimate the elasticity of substitution between different crude oil types. Using European data on country-level crude oil imports by field of origin, we argue that crude oil is not a homogenous good and...

This paper analyzes the effect of commodity price fluctuations on a commodity-exporting economy. Using Chilean and international copper market data, I find that positive copper price changes resulting from copper-specific demand shocks generate a broad GDP expansion, with no visible decline in...

While FTA negotiations are proliferating, our paper shows that targeting the appropriate sector is crucial for generating employment opportunities subsequent to FTA. In particular, we show that, countering conventional wisdom, targeting skill-biased exports and not the sector that employs...

While FTA negotiations are proliferating, our paper shows that targeting the appropriate sector is crucial for generating employment opportunities subsequent to FTA. In particular, we show that, countering conventional wisdom, targeting skill-biased exports and not the sector that employs...

Simultaneity represents a fundamental problem when estimating the elasticity of substitution between capital and labour. To overcome this problem, a wide variety of external instruments has been applied in the literature. However, the use of instruments may lead to wrong inference if they are...

There is widespread concern that climate policy is moving too slowly and that decarbonization of economic development is coming too late for effective climate protection. We analyze three different effects that emerge endogenously during decarbonization and amplify current policies: growing...

We build a general equilibrium model of endogenous communication, quality control and trade. We derive a structural gravity equation from the model and show that exogenous communication costs raise the costs of quality control and have a larger impact on products with a lower elasticity of...

This paper estimates the elasticity of intertemporal substitution for the euro area. It leverages the unique design of the Consumer Expectations Survey in Europe to directly infer it from the Euler equation. Our final estimates range between 0.7 and 0.8 for the euro area as a whole, which are...

We document and dissect a new stylized fact about firm growth: the shift from labor to intermediate inputs. This shift occurs in input quantities, cost and output shares, and output elasticities. We establish this fact using German firm-level data and replicate it in administrative firm data...

We document and dissect a new stylized fact about firm growth: the shift from labor to intermediate inputs. This shift occurs in input quantities, cost and output shares, and output elasticities. We establish this fact using German firm-level data and replicate it in administrative firm data...

This paper studies the spending response to news about a dividend tax reform to estimate the elasticity of intertemporal substitution (EIS). The Norwegian dividend tax reform was proposed in 2003, announced in 2004, and implemented in 2006, raising the dividend tax rate by 28 percentage points....

I estimate a nested CES production function for 9 European countries over 1996- 2020 using EU KLEMS data, distinguishing between information and communication technologies (ICT), intellectual property (IP) capital, and traditional capital. I assume that the aggregate output is produced using...

We study the heterogeneity of preferences regarding the limited substitutability of environmental public goods vis-a-vis private consumption goods and how it affects the economic valuation of environmental public goods. We show theoretically that mean marginal willingness to pay for an...

Legal and illegal markets often coexist. In theory, marginal legalization can either substitute for the remaining parallel market, or complement it via scale effects. I study migrants crossing without prior authorization at the US southwest border, where large-scale unlawful crossing coexists...

The structure of demand plays a fundamental role in shaping economic equilibrium. In computable general equilibrium analysis, comparative statics allow us to simulate how policies or external adjustments impact the equilibrium state. The results of these simulations are significantly influenced...

This paper provides one of the first estimates of elasticities of substitution across suppliers within the same product. This paper estimates these elasticities using new real-time administrative tax data on firm-to-firm transactions, with product-level prices and quantities, leveraging...