DP6965 Organizations and Trade

Author(s): Pol Antrās , Esteban Rossi-Hansberg

Publication Date: September 2008

Keyword(s): comparative advantage , contractual frictions , fragmentation , internalization , matching , offshoring , organizations , outsourcing , technology , wage inequality

JEL(s): D23 , E25 , F10 , F23 , L23

Programme Areas: Industrial Organization , International Trade and Regional Economics

Link to this Page: www.cepr.org/pubs/dps/DP6965.asp.asp

We survey an emerging literature at the intersection of organizational economics and international trade. We argue that a proper modelling of the organizational aspects of production provides valuable insights on the aggregate workings of the world economy. In reviewing the literature, we describe certain predictions of standard models that are affected or even overturned when organizational decisions are brought into the analysis. We also suggest potentially fruitful areas for future research.