How has the development of new trade models changed our understanding of the welfare gains from trade? Answering this question depends solely on estimates of the trade elasticity obtained using techniques applicable across different models. In this paper we build on the methods of Simonovska and...

Quantitative results from a large class of structural gravity models of international trade depend critically on the elasticity of trade with respect to trade frictions. We develop a new simulated method of moments estimator to estimate this elasticity from disaggregate price and trade-flow data...

Quantitative results from a large class of structural gravity models of international trade depend critically on the elasticity of trade with respect to trade frictions. We develop a new simulated method of moments estimator to estimate this elasticity from disaggregate price and trade-flow data...

Quantitative results from a large class of structural gravity models of international trade depend critically on the elasticity of trade with respect to trade frictions. We develop a new simulated method of moments estimator to estimate this elasticity from disaggregate price and trade-flow data...

This paper studies international technology and idea flows and their effects on growth and the welfare gains from openness. We analyze a model where producers decide either to acquire productivity-increasing ideas through search or to produce domestically and potentially for export with their...

Cross-country labor productivity differences are large in agriculture and much smaller in non-agriculture. We argue that these relative productivity differences arise when subsistence consumption needs prevent workers in poor countries from specializing in the sector in which they are most...

In postwar time series data, the elasticity of cyclical fluctuations in import volumes to measures of economic activity is well over two. A large class of models of international trade predict this elasticity to be one. This presents a challenge to these models with otherwise well regarded...

Poor countries import a larger volume of goods from rich countries, than rich countries import from poor countries. Furthermore, there is little difference in comparable price indices for tradable goods between rich and poor countries. Standard empirical implementation of structural gravity...

Empirical studies find a strong positive relationship between a country’s per-capita income and price level of final tradable goods. Among alternative explanations of this observation, I focus on variable mark-ups by firms. Mark-ups that vary with destinations’ incomes are evident from a...

One of the most well-known puzzles in international economics is the Lucas paradox: Why doesn't capital flow from rich to poor countries? Given the low capital-output ratios in developing countries, the difference in unconditional expected returns from investing there rather than in developed...