James Anderson and Eric van Wincoop criticized a common empirical model of it that they argued produced biased results by ignoring "multilateral resistance.
Heterogeneity across firms is behind a productivity shift in a model of this phenomenon created by Marc Melitz. James Anderson and Eric van Wincoop criticized a common empirical model of it that they argued produced biased results by ignoring "multilateral resistance." Predictions from a common model of this phenomenon can be visualized using Lerner diagrams. Autor, Dorn, and Hanson have suggested employment decreased and welfare rolls increased in areas most affected by this phenomenon in the early 2000s. Gravity models relate its magnitude to variables like distance. According to a theory of this phenomenon, if production occurs in the "cone of diversification," factor prices will equalize across space. Paul Krugman's models of it use increasing returns to scale to explain it in the absence of differences in factor endowments or technologies. For 10 points, name this exchange of goods and services across borders.
Heterogeneity across firms is behind a productivity shift in a model of this phenomenon created by Marc Melitz.
international trade