Recent models of trade with firm heterogeneity predict that opening to trade reduces the number of firms, increases the average size of firms, and decreases firms' markups. This paper uses a large dataset for 28 manufacturing industries and 46 countries to test these predictions. The econometric...

This paper examines why different countries export different qualities of products. Previous studies have attributed quality dispersion to differences in factor endowments while no empirical work has been done examining the effect of technology on quality. Using panel data on U.S. imports from...

We examine the relationship between a country’s institutional environment and the quality of its exports. Institutional factors such as widespread corruption, inefficient bureaucracy, and high risk of expropriation of private property by government can create uncertainty among producers and...

Empirical evidence suggests that sectoral export growth decreases exporters’ survival probability, whereas non-exporters are unaffected. Models with firm heterogeneity in total factor productivity predict the opposite. To solve this puzzle, we develop a two-factor framework where firms differ...