Gains from trade liberalization with flexible extensive margin adjustment

• 成果类型: Article
• 署名作者: Hsieh, Chang -Tai; Li, Nicholas; Ossa, Ralph; Yang, Mu-Jeung
• 署名单位: University of Chicago; National Bureau of Economic Research; Toronto Metropolitan University; University of Zurich; University of Oklahoma System; University of Oklahoma - Norman
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2023.103756
• 发表日期: 2023
• 关键词: trade; welfare; FIRMS; selection; Extensive margin; Sufficient statistic; LIBERALIZATION

摘要

We propose a sufficient statistic to measure the ex-post welfare gains from trade in CES models featuring any productivity distribution and any pattern of selection into production and exporting. This statistic is based on a single data moment, the change in the market share of continuing domestic producers, and a single structural parameter, the elasticity of substitution between products. We apply our statistic to measure Canada's gains from the Canada-US Free Trade Agreement using data on observed firm selection. We find that welfare gains can sub-stantially deviate from welfare estimates implied by formulas that assume a constant extensive margin trade elasticity.& COPY; 2023 Elsevier B.V. All rights reserved.