Aggregate Properties of Open Economy Models with Expanding Varieties

• 成果类型: Article
• 署名作者: Bhattarai, Saroj; Kucheryavyy, Konstantin
• 署名单位: University of Texas System; University of Texas Austin; University of Tokyo
• 刊物名称: JOURNAL OF THE EUROPEAN ECONOMIC ASSOCIATION
• ISSN/ISSBN: 1542-4766
• DOI: 10.1093/jeea/jvad037
• 发表日期: 2024
• 页码: 263-309
• 关键词: business-cycle; TRADE; entry; TECHNOLOGY; returns; COSTS

摘要

We present a unified framework to study interconnections between business cycle and international trade models. This unified framework is built upon the standard competitive, representative-firm international real business cycle model and features production externalities in the intermediate and final goods sectors. Our main theoretical result is that this unified framework is equivalent in aggregate implications to dynamic international trade models featuring monopolistic competition, endogenous entry and exit, and heterogeneous firms. We show that a negative capital externality in the intermediate good sector is required to fit the data. This presents a puzzle for the literature because when viewed through the lens of our unified framework, we demonstrate that the standard assumptions used in dynamic trade models imply a positive capital externality.