Working Paper: NBER ID: w14262
Authors: Pol Antràs; Esteban Rossi-Hansberg
Abstract: 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.
Keywords: organizational economics; international trade; production processes; multinational firms
JEL Codes: D23; E25; F10; F23; L23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Organizational decisions (D23) | Mapping between factors of production and consumer goods (E23) |
| Slicing of the value chain across countries (F12) | Predicted effects of trade integration on relative factor rewards (F16) |
| Internalization decision of firms (F23) | Overall pattern of multinational firm activity (F23) |
| Fragmentation of production across borders (F12) | Productivity of firms (D21) |
| Technological changes (O33) | Organizational adaptations (L29) |
| Organizational adaptations (L29) | Trade dynamics (F14) |
| Contractual frictions (L14) | Location of production (R32) |
| Location of production (R32) | Structure of trade flows (F14) |