We undertake a trade-growth accounting exercise by decomposing data on changes in bilateral international trade flows into their direct (endowment accumulation, productivity growth, changes in trade costs, changing preferences) and indirect components (general equilibrium effects). Furthermore,...

Modern quantitative theories of international trade rely on the probabilistic representation of technology and the assumption of the Law of Large Numbers (LLN), which ensures that when the number of traded goods goes to infinity, trade flows can be expressed via a deterministic gravity equation...

This paper challenges the common assumption of market segmentation in international trade. To analyze export entry and pricing decisions of firms in integrated vs. segmented markets, we develop a novel tractable approach based on stochastic export costs that allows us to compare firm-level and...