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Contribution Details

Type Working Paper
Scope Discipline-based scholarship
Title Accounting for the new gains from trade liberalization
Organization Unit
  • Chang-Tai Hsieh
  • Nicholas Li
  • Ralph Ossa
  • Mu-Jeung Yang
  • English
Institution National Bureau of Economic Research
Series Name NBER Working Papers
Number 22069
Number of Pages 48
Date 2018
Abstract Text We challenge the conventional wisdom on the variety and productivity gains from trade liberalization which are commonly referred to as "new" gains from trade. In particular, we show that the import variety gains measured in studies such as Broda and Weinstein (2006) are counteracted by exactly analogous domestic variety losses. Similarly, we show that the domestic productivity gains measured in studies such as Trefler (2004) are counteracted by exactly analogous import productivity losses. We then account for all these gains and losses in an application to the Canada-US Free Trade Agreement and show that Canada actually experienced net "new" losses from trade.
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