Development and International Economics

Conference in Honor of Robert E. Lucas Jr.

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Nobel laureate Robert E. Lucas will be awarded the University of Chicago's rare and prestigious Division of Social Science Phoenix Prize in recognition of his influential contributions to changing the field of economics.

To commemorate this award, the Becker Friedman Institute, the Department of Economics, and the Division of the Social Sciences are hosting a conference in his honor at the University of Chicago. Distinguished colleagues and coauthors will participate in this research conference exploring the impact of Lucas’s work.

The Case of Brazil

Brazil—the fifth largest and most populous country in the world—occupies roughly 50 percent of the landmass in South America. Its coastline extends for 4,578 miles along the Atlantic Ocean, and rainforests make up almost 60 percent of the country.

The Margins of Global Sourcing: Theory and Evidence from U.S. Firms

Pol Antras, Teresa C. Fort, Felix Tintelnot

We develop a quantifiable multi-country sourcing model in which firms self-select into importing based on their productivity and country-specific variables. In contrast to canonical export models where firm profits are additively separable across destination markets, global sourcing decisions naturally interact through the firm’s cost function. We show that, under an empirically relevant condition, selection into importing exhibits complementarities across source markets. We exploit these complementarities to solve the firm’s problem and estimate the model. Comparing counterfactual predictions to

What Drives Home Market Advantage?

A. Kerem Coşar, Paul L.E. Grieco, Shengyu Li, Felix Tintelnot

In the automobile industry, as in many tradable goods markets, firms usually earn their highest market share within their domestic market. The goal of this paper is to disentangle the supply- and demand-driven sources of the home market advantage. While trade costs, foreign production costs, and taste heterogeneity all matter for market outcomes, we find that a preference for home brands is the single most important driver of home market advantage - even after controlling for brand histories and dealer networks.

Systemic Uncertainty and the Emergence of Border Disputes

Scott F Abramson, David B. Carter

Although an abundance of evidence shows that territorial disputes fundamentally shape relations among states, we know surprisingly little about when territorial claims are made. We use new data on the spatial distribution of historical borders and territorial claims across four centuries of European history to demonstrate that the majority of territorial claims are drawn following historical boundary precedents at times of high systemic uncertainty.