levels at the more disaggregated industrial level. These are especially important in the context of international trade as … these determine the dynamics of comparative advantages and the resulting trade structures between developing and developed …-up processes and their links to dynamic comparative advan- tages and trade structures. In the second part we present an econometric …

We present, extend and estimate a model of international trade with firm heterogeneity in the tradition of Melitz (2003 … prices, productivity levels and markups as functions of openness to trade at a sectoral level. The theory lends itself … naturally to a difference in differences estimation, with international differences in trade openness at the sector level …