In an earlier paper, we showed that bilateral exchange rates are important determinants of multinational activity of both the US and Japan and that increases in the bilateral and third-country exchange rates exert opposing effects on bilateral multinational activity. Furthermore, the signs of...

This paper sets up a two‐country model of offshoring with monopolistically competitive product and monopsonistically competitive labor markets. In our model, an incentive for offshoring exists even between symmetric countries, because shifting part of the production abroad reduces local labor...

This paper introduces a model of corporate governance into the general oligopolistic equilibrium theory of international trade. Corporate governance defines the influence of workers and capital owners on manager contract and, through this contract, the scope of these two groups for subsequent...

Leading theories suggest that amongst continuing exporters, lower variable trade costs should boost exports of smaller firms by the same or greater percentage rate than larger firms. However, investigating the impact of the deep EU‐South Korea FTA with French customs data, we find robust...

A stylized monopolistic competition model of international trade is proposed where firms differ with respect to the expected economic lifetime of their innovations. Upon entry, they receive a commonly observed signal which is updated over time. Jointly with partial irreversibility of investment,...