Country Size, International Trade, and Aggregate Fluctuations in Granular Economies

• 成果类型: Article
• 署名作者: di Giovanni, Julian; Levchenko, Andrei A.
• 署名单位: International Monetary Fund; University of Michigan System; University of Michigan; National Bureau of Economic Research
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/669161
• 发表日期: 2012
• 页码: 1083-1132
• 关键词: OPTIMUM PRODUCT DIVERSITY; monopolistic competition; Power laws; volatility; GROWTH; IMPACT; LIBERALIZATION; TECHNOLOGY; openness; scale

摘要

This paper proposes a new mechanism by which country size and international trade affect macroeconomic volatility. We study a model with heterogeneous firms that are subject to idiosyncratic firm-specific shocks, calibrated to data for the 50 largest economies in the world. When the firm size distribution follows a power law with an exponent close to minus one, idiosyncratic shocks to large firms have an impact on aggregate volatility. Smaller countries have fewer firms and, thus, higher volatility. Trade opening makes the large firms more important, thus raising macroeconomic volatility. Trade can increase aggregate volatility by 15-20 percent in some small open economies.