Productivity and firm selection: quantifying the ‘new’ gains from trade

Gregory Corcos, Massimo Del Gatto, Giordano Mion and Gianmarco Ottaviano

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We discuss how standard computable equilibrium models of trade policy can be enriched with selection effects. This is achieved by estimating and simulating a partial equilibrium model that accounts for a number of real world effects of trade liberalisation: richer availability of product varieties; tougher competition and weaker market power of firms; better exploitation of economies of scale; and, of course, efficiency gains via firms selection. The model is estimated on EU data and then simulated in counterfactual scenarios. Gains from trade are much larger in the presence of selection effects with substantial variability across countries and sectors.

JEL-codes: J01 J1 R14 (search for similar items in EconPapers)
Date: 2011-12-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published in The Economic Journal, 1, December, 2011, 122(561), pp. 754-798. ISSN: 0013-0133

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http://eprints.lse.ac.uk/42684/ Open access version. (application/pdf)

Related works:
Journal Article: Productivity and Firm Selection: Quantifying the ‘New’ Gains from Trade (2012)
Working Paper: Productivity and Firm Selection: Quantifying the "New" Gains from Trade (2009)
Working Paper: Productivity and Firm Selection: Quantifying the "New" Gains from Trade (2009)
Working Paper: Productivity and firm selection: quantifying the "new" gains from trade (2009)
Working Paper: Productivity and Firm Selection: Quantifying the “New” Gains from Trade (2009)
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