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This paper proposes a generalized speci…cation for the panel data model with random e¤ects and …rst-order spatially autocorrelated residuals that encompasses two previously suggested speci…cations. The …rst one is described in Anselin's (1988) book and the second one by Kapoor, Kelejian, and Prucha (2007). Our encompassing speci…ca-tion allows us to test(More)
Up-to-date information about CPR's research projects and other activities is available from our World Wide Web site at www-cpr.maxwell.syr.edu. All recent working papers and Policy Briefs can be read and/or printed from there as well. Abstract The recent general equilibrium theory of trade and multinationals emphasizes the importance of third countries and(More)
The European Union (EU) provides grants to disadvantaged regions of member states to allow them to catch up with the EU average. Under the Objective 1 scheme, NUTS2 regions with a per-capita GDP level below 75% of the EU average qualify for structural funds transfers from the central EU budget. This rule gives rise to a regression-discontinuity design that(More)
Recent work by Anderson and van Wincoop (2003) establishes an empirical mod-eling strategy which takes full account of the structural, non-(log-)linear impact of trade barriers on trade in new trade theory models. This framework has never been used to evaluate and quantify the role of endogenous preferential trade agreement (PTA) membership for trade. Apart(More)
Previous empirical work on the determinants of preferential trade agreement (PTA) membership assumes a country's PTA participation to leave other countries' willingness to participate unaffected. More precisely, the presumption is that new PTAs do neither influence the formation of other new PTAs in the future nor do they affect the subsequent enlargement(More)
Up-to-date information about CPR's research projects and other activities is available from our World Wide Web site at www-cpr.maxwell.syr.edu. All recent working papers and Policy Briefs can be read and/or printed from there as well. Abstract: Recent research on trade and multinationals highlights a novel issue with multinational firms. In particular,(More)
Up-to-date information about CPR's research projects and other activities is available from our World Wide Web site at www-cpr.maxwell.syr.edu. All recent working papers and Policy Briefs can be read and/or printed from there as well. Abstract This paper proposes a generalized panel data model with random effects and first-order spatially autocorrelated(More)
Firms need to incur substantial sunk costs to break in foreign markets, yet many give up exporting shortly after their rst experience, which typically involves very small sales. Conversely, other new exporters shoot up their foreign sales and expand to new destinations. We investigate a simple theoretical mechanism that can rationalize these patterns. A rm(More)
This paper formulates an empirical model to estimate the impact of endogenous new regional trade agreement (RTA) membership on trade structure. The likelihood of new RTA membership is influenced by economic fundamentals such as country size, factor endowments, and trade and investment costs. In a sample of country-pairs covering mainly the OECD economies we(More)