Trade Margins, Price, and Product Quality Adjustments to Non-Tariff Measures: Evidence from French Firms

Globalization has increased interdependencies between countries and therefore the need for effective regulation. The enforcement of minimum quality standards such as sanitary and phytosanitary (SPS) measures and technical barriers to trade (TBTs) allows governments to guarantee the absence of negative externalities. For instance, SPS measures have been adopted in response…

A European disease? Non-tradable inflation and real interest rate divergence

When the euro was introduced, conditions for economic convergence –the process of narrowing income gaps between lower and higher income countries– seemed to be present. Nominal interest rates between higher and lower income countries had converged rapidly and capital was flowing from the richer (the "core") to the poorer (the…

Sales and Markup Dispersion: Theory and Empirics

Models of monopolistic competition with heterogeneous firms have provided a fertile laboratory for studying a range of problems relating to the process of globalization. Much of this work to date has assumed special forms for preferences and technology, usually CES preferences on the demand side, and a Pareto distribution of…

Trade and long term unemployment

What is the effect of international trade on unemployment? In this paper, we explore the link between openness to trade and unemployment using a multi-country, multi-sector gravity model with embedded heterogeneous sector-and-country specific labour market frictions. Specifically, we introduce Diamond-Mortensen-Pissarides search-and-matching frictions, as modelled in Helpman and Itskhoki (2010), into…

Immigration and Wages Inequality in France

Over 232 million people now reside in a country where they were not born. Immigrants thus account for 3.2% of the world's population. In the past two decades, the fraction of the population in developed countries that is foreign-born increased from 7% in 1990 to 10% in 2010. The…