Recent changes in comparative advantage in the largest OECD economies differ significantly from the predictions of Heckscher-Ohlin-Vanek theory. Japan's rising share of OECD machinery exports and the improvement in the comparative advantage of the USA and Germany in heavy industry were...

What determines competition dynamics in markets with indirect network effects? We analyze this question in a dynamic hardware-software framework, where software firms compete in quality upgrades. We identify market structure as a major determinant of competition dynamics. Indirect network...

We argue that the quality of institutions that enforce contracts and protect property rights influences the costs of producing high-value added (complex) versus low-value added (simple) products. Since data is hardly available for domestic transactions, we generate predictions about the...

This paper reviews issues that lie at the intersection between intellectual property rights (IPR) and network effects, especially in the context of the global economy. Some of the relevant questions are: (1) How do IPR influence the provision of goods exhibiting network effects? (2) How do...

How does the quality of national institutions that enforce the rule of law influence international trade? Anderson and Marcouiller argue that bad institutions located in the importer's country deter international trade because they enable economic predators to steal and extort rents at the...

This paper uses a Ricardian model to generate predictions about the influence of institutions on trade in differentiated (complex) and commoditized (simple) products and then uses a rich international trade data set for empirical tests. The model draws the distinction between the role of...

What causes economic change? Traditionally, economists have answered that the explanation lies in exogenous shocks to technology, factor stocks, or preferences. In the last half-decade of his career, the Canadian economic historian Harold Innis (1894-1952) proposed an alternative approach - a...