Journal article

Publication year: 2013

Pages: 549-558

Journal: Review of Development Economics

Volume number: 17

Issue number: 3

ISSN: 1363-6669

eISSN: 1467-9361

Open access status: Green

DOI Link: https://doi.org/10.1111/rode.12049

Publisher: Wiley

Abstract: 
We propose occupational decisions of heterogeneous individuals as an alternative mechanism of explaining the distribution of firm productivities emphasized by empirical studies. Thus, we integrate the frameworks of Melitz (Econometrica 71 (2003):1695-725), and of Manasse and Turrini (Journal of International Economics 54 (2001):97-117) that establish the theoretical base of trade models with heterogeneous firms. Our model is technically much simpler than the Melitz approach while preserving the main results on firm-selection effects caused by international market integration. Our approach paves the way for detailed analysis of institutions in a heterogeneous firm model to better understand the link between institutions and an economy's productivity distribution.

Harvard Citation style: Meckl, J. and Weigert, B. (2013) Occupational Choice, Aggregate Productivity, and Trade, Review of Development Economics, 17(3), pp. 549-558. https://doi.org/10.1111/rode.12049

APA Citation style: Meckl, J., & Weigert, B. (2013). Occupational Choice, Aggregate Productivity, and Trade. Review of Development Economics. 17(3), 549-558. https://doi.org/10.1111/rode.12049