Information globalization
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- dc.contributor.author Baley, Isaac
- dc.contributor.author Veldkamp, Laura
- dc.contributor.author Waugh, Michael
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
- dc.date.accessioned 2024-11-14T10:09:35Z
- dc.date.available 2024-11-14T10:09:35Z
- dc.date.issued 2016-03-01
- dc.date.modified 2024-11-14T10:05:15Z
- dc.description.abstract Common wisdom dictates that uncertainty impedes trade we show that uncertainty can fuel more trade in a simple general equilibrium trade model with information frictions. In equilibrium, increases in uncertainty increase both the mean and the variance in returns to exporting implying that trade can increase or decrease with uncertainty depending on preferences. Under general conditions on preferences, we characterize the importance of these forces using a sufficient statistics approach. Higher uncertainty leads to increases in trade because agents receive improved terms of trade, particularly in states of nature where consumption is most valuable. Trade creates value, in part, by offering a mechanism to share risk and risk sharing is most effective when both parties are uninformed.
- dc.format.mimetype application/pdf*
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1529
- dc.identifier.citation Journal of International Economics, Vol.126, September 2020
- dc.identifier.uri http://hdl.handle.net/10230/27210
- dc.language.iso eng
- dc.relation.ispartofseries Economics and Business Working Papers Series; 1529
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
- dc.rights.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- dc.subject.keyword information asymmetry
- dc.subject.keyword globalization
- dc.subject.keyword risk sharing
- dc.subject.keyword international trade
- dc.subject.keyword Macroeconomics and International Economics
- dc.title Information globalization
- dc.title.alternative Can Global Uncertainty Promote International Trade?
- dc.type info:eu-repo/semantics/workingPaper