Dynamics of Firms and Trade in General Equilibrium
70 Pages Posted: 31 Dec 2013
There are 2 versions of this paper
Dynamics of Firms and Trade in General Equilibrium
USC-INET Research Paper No. 15-12
Number of pages: 55
Posted: 11 Mar 2015
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63
Date Written: June 2013
Abstract
This paper develops a dynamic general equilibrium model that tries to reconcile the observation that aggregate movements of exports and imports are "disconnected" from real exchange rate movements, while Â…firm-level exports co-move significantly with the real exchange rate. Firms are heterogeneous, facing recurrent aggregate and firm-product specific productivity shocks, choose which goods to export, and decide to enter and exit the business endogenously. We calibrate and estimate the model with both aggregate and firm level data from Japan.
Suggested Citation: Suggested Citation
Dekle, Robert and Jeong, Hyeok and Kiyotaki, Nobuhiro, Dynamics of Firms and Trade in General Equilibrium (June 2013). KDI School of Pub Policy & Management Paper No. 13-06, Available at SSRN: https://ssrn.com/abstract=2372988 or http://dx.doi.org/10.2139/ssrn.2372988
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