CORDIS Project
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This project investigates how differences among firms affect their trade patterns and productivity. It explores the implications of firm heterogeneity on welfare changes due to trade liberalization, focusing on the importance of firm-level characteristics and the distribution of productivity.
Accounting for firms' heterogeneity in trade patterns is probably one of the key innovations of international trade that occurred during the last decade.
The impact of initial papers such as Melitz (2003) and Bernard and Jensen (1999) is so large in the field that it is considered to have introduced a new paradigm.
Apart from providing a convincing framework for a set of empirical facts, the main motivation of this literature was that there are new gains to be expected from trade liberalization.…
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