Granular Comparative Advantage

Cecile Gaubert and Oleg Itskhoki

Journal of Political Economy, 2021, vol. 129, issue 3, 871 - 939

Abstract: Large firms play a pivotal role in international trade. We develop a multisector granular model of trade where sectors host a finite number of firms. Both aggregate and granular firm-level forces shape comparative advantage. The model is estimated using French microdata on firm domestic and export sales. We find that granularity accounts for about 20% of the sectoral variation in export intensity and is more pronounced in highly export-intensive sectors. An extension to a dynamic environment with both idiosyncratic and aggregate shocks reveals that firm dynamics plays a central role in shaping comparative advantage reversals observed in the data.

Date: 2021
References: Add references at CitEc
Citations: View citations in EconPapers (38)

Downloads: (external link)
http://dx.doi.org/10.1086/712444 (application/pdf)
http://dx.doi.org/10.1086/712444 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
Working Paper: Granular Comparative Advantage (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:jpolec:doi:10.1086/712444

Access Statistics for this article

More articles in Journal of Political Economy from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().