The recent microeconomic literature on international trade has highlighted the importance of firm characteristics and trade costs for exports. This study provides evidence on one type of those costs, the costs of doing business overseas, from a theoretical and empirical perspective. Controlling...

Endogenous growth models, such as Barro (1990), predict that government expenditure and taxation will have both temporary and permanent effects on growth. We test this prediction using panels of annual and period-averaged data for OECD countries during 1970-95, isolating long-run from short-run...

Recent models of international trade have identified product quality as an important determinant of bilateral trade flows. Yet relatively little is understood about the relationship between the characteristics of the export market and the quality of products. In this paper we examine this link...

We develop and analyze an entry model that predicts that the likelihood that foreign firms enter a country increases with the productivity gap between foreign and domestic firms. The intuition is that foreign firms locate where their competitive advantage is highest and thus enter countries...

We analyse a very rich and unique panel database which provides information on exports at the firm-product level. A stylised fact in the data is that many firms add as well as drop products from the export mix in any given year. Motivated by recent theory we investigate what determines the...

A key distinction which has emerged from heterogeneous firm models of international trade is that of exporting at the intensive and extensive margins. Empirically however, the two are often conflated, leading to biased estimates of the impact of falling trade costs. This paper exploits detailed...

Our focus is the effects of exchange rate movements on firm decisions on export market entry and export intensity. Using data on UK manufacturing firms we find that exchange rate movements have little effect on firm export participation but have a significant impact on export shares. We also...