The relationships between trade and foreign investment (FDI) are at the core of globalisation. Analytical work has recently been developed by OECD in order to explore the nature of these links in quantitative terms. This report combines the previous more technical work developed over the last...

We examine the effect of exchange-rate misalignments on competition in the market for large commercial aircraft. This market is a duopoly where players compete in dollar-denominated prices while one of them, Airbus, incurs costs mostly in euros. We construct and calibrate a simulation model to...

This paper develops a dynamic model of cross-border M&A activity. We show that foreign firms will be relatively more attracted to targets in the domestic country that had high productivity levels several years prior to acquisition, but then suffered a negative productivity shock (i.e., cherries...

North-South competition in quality: Analyzing a new database that makes it possible to disaggregate trade flows across many countries according to unit values, we show that international specialization in terms of quality within industries and product categories plays an important role in the...

Geography, economic size, or common history, help predicting signed regional trade agreements (RTAs). However, not all signed RTAs are “natural” according to economic determinants. En-dogeneity and general equilibrium effects of RTAS are the two mechanisms addressed in this paper. We...

This paper explores the economic impacts of preferential trade agreements, conditional on their level of ambition. We cluster 278 agreements, encompassing 910 provisions over 18 policy areas and estimate the trade elasticity for the different clusters. We then use these elasticities in a series...