What tariffs would countries impose if they did not have to fear any retaliation? What would occur if there was a complete breakdown of trade policy cooperation? What would be the outcome if countries engaged in fully efficient trade negotiations? And what would happen to trade policy...

I show that accounting for cross-industry variation in trade elasticities greatly magnifies the estimated gains from trade. The main idea is as simple as it is general: While imports in the average industry do not matter too much, imports in some industries are critical to the functioning of the...

How large are optimal tariffs? What tariffs would prevail in a worldwide trade war? How costly would be a breakdown of international trade policy cooperation? And what is the scope for future multilateral trade negotiations? I address these and other questions using a unified framework which...

I suggest a novel theory of GATT/WTO negotiations based on the Krugman (1980) "new trade" model. It emphasizes international production relocations and is easy to calibrate to bilateral trade data. Focusing on the major players in recent GATT/WTO negotiations, I find that it implies reasonable...

We challenge the conventional wisdom on the variety and productivity gains from trade liberalization which are commonly referred to as "new" gains from trade. In particular, we show that the import variety gains measured in studies such as Broda and Weinstein (2006) are counteracted by exactly...

We generalize Krugman's (1979) 'new trade' model by allowing for an explicit production chain in which a range of tasks is performed sequentially by a number of specialized teams. We demonstrate that an increase in market size induces a deeper division of labor among these teams which leads to...

How does a country's productivity growth a¤ect worldwide real incomes through international trade? In this paper, we take this classic question to the data by measuring the spillover e¤ects of China's productivity growth. Our framework features traditional terms-of-trade e¤ects and new trade...

We examine how deep agreements on domestic regulations affect welfare in a world where such agreements are influenced by producer lobbies. The answer to this question depends in a critical way on whether the agreement focuses on product standards or on production regulations. International...

International investment agreements employ dispute settlement procedures that differ markedly from their counterparts in trade agreements along three key dimensions: standing (i.e., the right to file grievances), the nature of the remedy, and the remedial period. In the state-to-state dispute...

Modern trade agreements no longer emphasize basic trade liberalization but instead focus on international policy coordination in a much broader sense. In this paper we introduce the emerging literature on the political economy of such deep integration agreements. We organize our discussion...