While neoclassical theory emphasizes the impact of trade on wage inequality between
occupations and sectors, more recent theories of firm heterogeneity point to the impact of …

Large cities produce more output per capita than small cities. This higher productivity may
occur because more talented individuals sort into large cities, because large cities select …

This article develops an elementary theory of global supply chains. We consider a world
economy with an arbitrary number of countries, one factor of production, a continuum of …

Abstract Following Grossman and Rossi-Hansberg (2008) we present a model in which
tasks of varying complexity are matched to workers of varying skill in order to develop and …

This paper develops tools and techniques to analyze the determinants of factor allocation
and factor prices in economies with a large number of goods and factors. The main results of …

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Technological change has reduced the relative price of capital goods. Reductions in trade
costs make it cheaper to import capital goods. With capital-skill complementarity, both can …

We develop a theory of capital controls as dynamic terms-of-trade manipulation. We study
an infinite-horizon endowment economy with two countries. One country chooses taxes on …

We develop a model of international trade between two symmetric countries that features
inter-group inequality between managers and workers, and also intra-group inequality …

This paper analyzes how intra-industry trade affects the wage distribution when both
workers and firms are heterogeneous. Positive assortative matching between worker skill …