Fears of job losses and of increasing inequality loom large in current debates on how globalization is affecting our economies. By fundamentally changing the organization of production and work, globalization creates complex and changing patterns of winners and losers. Globalization thus creates...

We study how the interaction between economic openness and competitive selection affects the effectiveness of employment (and entry) subsidisation. Within a twocountry heterogeneous-firms model with endogenous labour supply, we find that optimal employment subsidies are always positive even...

High inter-country variability characterises the responsiveness of both output to (exogenous) shocks and employment to output contractions. We argue that intercountry differences in firm-size distributions contribute to explaining this variability. Within an open economy model, we show that...

The conventional wisdom is that increasing globalisation requires a reduction in the provision of the welfare state among industrialised countries as the distortions resulting from this type of expenditure undermine international competitiveness and the ability of countries to attract and/or...