The authors argue that endogeneity of transportation costs needs to be taken into account when estimating the effect of distance on trade. Otherwise, the estimates of the distance effect may be biased and inconsistent. Endogenous transportation can introduce slope heterogeneity and spatial...

The authors argue that endogeneity of transportation costs needs to be taken into account when estimating the effect of distance on trade. Otherwise, the estimates of the distance effect may be biased and inconsistent. Endogenous transportation can introduce slope heterogeneity and spatial...

This study investigates the effects of the transportation cost on the international trade. The first essay explores the effect of the transportation cost on the quality composition of trade. We derive a relationship between per unit and ad-valorem trade costs and the quality composition of trade...

This paper examines how the quality of exports depends on relative country size and its remoteness. Specific transportation cost is the key variable in our analysis as it gives rise to the Alchian-Allen effect. In the model, we allow for endogenous quality choice by a producer serving many...

A discriminatory tariff can be welfare superior to free trade in the presence of regional economies of scale. This is because a tariff on non-regional trade concentrates trade within a region, lowering the cost of transportation, so that the gains from economies of scale can theoretically offset...

When an anti-dumping (AD) duty is imposed, a foreign exporting firm must decide whether to stay in the market and how to price its product. This paper investigates both of these decisions, but focuses on firm pricing by exploring the pass-through of the AD duty. Our model of exporter behavior...

Analyzing differences in the quality of information-intensive goods may require information processing from consumers. Focusing on the differences between organic and conventional milk, we propose analyzing such markets using a tractable micro-founded discrete choice framework with Rational...

The purpose of this paper is to study the closed-end fund discount in Miller's (1977) framework. Miller's theory states that in the simultaneous presence of (1) short sale restrictions and (2) dispersion of investors' opinions, securities become overvalued. We show that discounts of...