This paper reviews the most significant recent developments in the theory of trade agreements. The paper offers an integrated approach to evaluating trade agreements, and uses the approach to present results on preferential and multilateral trade agreements. The paper identifies also several...

We augment the canonical neoclassical model of trade to allow for interstate disputes over land, oil, water, or other resources. The costs of such disputes in terms of arming depend on the trade regime in place. Under either autarky or free trade, the larger country (in terms of factor...

Typically, economics assumes that property rights over productive resources or goods are perfectly defined and costlessly enforced. The costs of insecurity and the resultant conflict are, however, real and often economically significant. In this paper, we examine how international trade regimes...

In recent years wages in China have been rising and the yuan has appreciated, potentially eroding China's cost advantage in manufactures. This paper explores the evolution of China's relative unit labor costs in manufacturing over 1998-2009. Between 1998 and 2003 China's unit labor costs fell,...

Three years ago, very few economists would have imagined that one of the newest and fastest growing research areas in international trade is the use of quantitative trade models to estimate the economic welfare losses from dissolutions of major countries' economic integration agreements (EIAs)....

China has defied the declining trend in domestic content in exports in many countries. We study China's rising domestic content in exports using firm- and customs transaction-level data. Our approach embraces firm heterogeneity and hence reduces aggregation bias. We find that the substitution of...

We present a heterogeneous-firm model in which management ability increases both pro- duction efficiency and product quality. Combining six micro-datasets on management prac- tices, production and trade in Chinese and American firms, we find broad support for the model's predictions. First,...

The fragmentation of production across borders allows firms to make and export final goods, or to perform only intermediate stages of production by processing imported inputs for re-exporting. We examine how financial frictions affect companies’ choice between processing and ordinary trade -...

Quantitative results from a large class of international trade models depend critically on the elasticity of trade with respect to trade frictions. We develop a simulated method of moments estimator to estimate this elasticity from disaggregate price and trade-flow data using the Ricardian...

This paper studies the performance of China's exports during the 2008-2009 financial crisis. It focuses on the speed at which China's exports were hit by this downturn. Product-country monthly exports data is utilized. It is found that GDP growth rates of importing countries play an important...