Can Multi-Stage Production Explain the Home Bias in Trade?

Equity Home Bias: Can Information Cost Explain the Puzzle?

Outsourcing with Home Bias and Trade Policy∗

This paper examines a simple model of outsourcing involving matching frictions and home bias in firms’ acquisition of intermediate goods. Two groups of seller firms—local sellers and foreign sellers—may face different degrees of search frictions even though they are identical in terms of productivity. Two groups of buyer firms are considered: one group accepts local and foreign sellers equally,...

Technology, Trade Costs, and the Pattern of Trade with Multi-Stage Production

Comparative advantage and trade costs shape the geography of cross-border supply chains and trade flows. To quantify these forces, we build a model of trade with sequential, multi-stage production that features technology differences both across and within individual production stages. We estimate technology and trade costs in the model via simulated method of moments, matching bilateral shipme...

Multi-Objective Scheduling Problem in a Three-Stage Production System

A three stage production system is considered in this paper. There are two stages to fabricate and ready the parts and an assembly stage to assembly the parts and complete the products in this system. Suppose that a number of products of different kinds are ordered. Each product is assembled with a set of several parts. At first the parts are produced in the first stage with parallel machines a...

Can the Trade-off Theory Explain Debt Structure?

We examine the optimal mixture and priority structure of bank and market debt using a trade-off model in which banks have the unique ability to renegotiate outside formal bankruptcy. Flexible bank debt offers a superior trade-off between tax shields and bankruptcy costs. Ease of renegotiation limits bank debt capacity, however. Optimal debt structure hinges upon which party has bargaining power...