Industry Reallocations in a Globalizing Economy
Gianmarco I.P. Ottaviano
Bocconi University - Department of Economics and Paolo Baffi Centre on Central Banking and Financial Regulation
Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE); Université de Bourgogne - LATEC
Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE)
CEPR Discussion Paper No. 6049
We distill the main insights from recent trade models on firms' responses to globalisation. Our primary aim is to assess the economic impact and the welfare implications of the resulting reallocation of resources across firms and countries. In so doing, we bring theory into life through the numerical implementation of a theoretical framework calibrated on European data, which encompasses aspects of economic geography, firm heterogeneity, and firms' organizational choices. Our final purpose is to provide a comprehensive background for empirical investigations and to stimulate further theoretical research.
Keywords: Economic geography, firm heterogeneity, international integration, multinationals, resource reallocation
JEL Classification: F12working papers series
Date posted: June 28, 2007
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