International Trade and Macroeconomic Dynamics with Heteroegenous Firms

Preprint OPEN
Ghironi, Fabio; Melitz, Marc J;
(2004)
  • Subject: endogenous non-tradeness; entry; Harrod-Balassa-Samuelson effect; heterogenous producers; international business cycles; persistence; real exchange rate dynamics
    • jel: jel:F12 | jel:F41

We develop a stochastic, general equilibrium, two-country model of trade and macroeconomic dynamics. Productivity differs across individual, monopolistically competitive firms in each country. Firms face a sunk entry cost in the domestic market and both fixed and per-un... View more
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