EconPapers    
Economics at your fingertips  
 

Aggregating From Micro to Macro Patterns of Trade

Stephen Redding and David E. Weinstein

No 12446, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We develop a new framework for aggregating from micro to macro patterns of trade. We derive price indexes that determine comparative advantage across countries and sectors and the aggregate cost of living. If firms and products are imperfect substitutes, we show that these price indexes depend on variety, average demand/quality and the dispersion of demand/quality-adjusted prices, and are only weakly related to standard empirical measures of average prices, thereby providing insight for elasticity puzzles. Of the cross-section (time-series) variation in comparative advantage, 50 (90) percent is accounted for by variety and average demand/quality, with average prices contributing less than 10 percent.

Keywords: comparative advantage; prices; Quality; Trade; Variety (search for similar items in EconPapers)
JEL-codes: F11 F12 F14 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-int
Date: 2017-11
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6) Track citations by RSS feed

Downloads: (external link)
http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=12446 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Working Paper: Aggregating From Micro to Macro Patterns of Trade (2018) Downloads
Working Paper: Aggregating from Micro to Macro Patterns of Trade (2017) Downloads
Working Paper: Aggregating from micro to macro patterns of trade (2017) Downloads
Working Paper: Aggregating from Micro to Macro Patterns of Trade (2017) Downloads
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:cpr:ceprdp:12446

Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... rs/dp.php?dpno=12446

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().

 
Page updated 2019-10-18
Handle: RePEc:cpr:ceprdp:12446