The Desire for (Danish) Quality in High and Low Income Countries

We estimate the correlation between firm prices and sales within a CN8 product-country-year market. We do this for every market to which at least 16 different Danish firms exported between 1999 and 2006. Approximately 60% of Danish exports are to markets in which the price is negatively correlated with sales. These correlations are significantly different across destination countries within product categories, but across years for a given product-destination pair. While some existing theories perform better than others at predicting these patterns, none can reconcile the variation across countries. To fully explain the patterns, We introduce a model in which the price-sales correlation can be interpreted as the market's desire for high quality goods over low cost substitutes. We discover an inverted U shaped relation between a country's desire for quality and its per capita GDP, which we term a Quality Kuznets Curve. This curve has a turning point around 10 000 Euros for Danish exports. The Quality Kuznets Curve appears both when looking across products and within products.exports; firm heterogeneity; quality; productivity; Kuznets

Demand Uncertainty: Exporting Delays and Exporting Failures

This paper presents a model of trade that explains why firms wait to export and why many exporters fail. Firms face uncertain demands that are only realized after the firm enters the destination. The model retools the timing of uncertainty resolution found in productivity heterogeneity models. This retooling addresses several shortcomings. First, the imperfect correlation of demands reconciles the sales variation observed in and across destinations. Second, since demands for the firm's output are correlated across destinations, a firm can use previously realized demands to forecast unknown demands in untested destinations. The option to forecast demands causes firms to delay exporting in order to gather more information about foreign demand. Third, since uncertainty is resolved after entry, many firms enter a destination and then exit after learning that they cannot profit. This prediction reconciles the high rate of exit seen in the first years of exporting. Finally, when faced with multiple countries in which to export, some firms will choose to sequentially export in order to slowly learn more about its chances for success in untested markets.firm heterogeneity; exporting; trade failures; trade delay

Cost Linkages Transmit Volatility Across Markets

We present and test a model relating a firm's idiosyncratic cost, its exporting status, and the volatilities of its domestic and export sales. In prior models of trade, supply costs for domestic and exports were linear and thus additively separable. We introduce a nonlinear cost function in order to link the domestic and export supply costs. This theoretical contribution has two new implications for the exporting firm. First, the demand volatility in the foreign market now directly affects the firm's domestic sales volatility. Second, firms hedge domestic demand volatility with exports. The model has several testable predictions. First, larger firms have lower total and domestic sales volatilities. Second, foreign market volatility increases domestic sales volatilities for exporters. Third, exporters allocate output across both markets in order to reduce total sales volatility. We find evidence for these predictions with Danish firms operating between 1992 and 2006.

Decomposing Firm-level Sales Variation

We measure the contribution of firm-specific effects to overall sales variation within a destination and find it remarkably low. Our empirical decomposition is structurally motivated by a heterogeneity model of exporting involving destination-specific, firm-specific, and firm-destination-specific latent effects with incidental truncation. We use a highly detailed dataset with exports by products and destinations for all Danish manufacturing firms. We find the contribution of firm-specific heterogeneity to within-destination sales variation varies greatly across HS6 products, and that for the median product it drives 31% of the sales variation. When we remove first-time exports from our sample, the median value increases to 40%, implying that firm-destination-specific effects are most important the first year. We conclude that while firm-specific productivity can account for some of the variation, the majority is explained by firm-destination-specific heterogeneity sources such as firm-destination-specific demand.firm heterogeneity; firm-level export data; truncation correction

Simultaneous control of volumetric light distribution through turbid media using real-time three-dimensional optoacoustic feedback

Focusing light through turbid media presents a highly fascinating challenge in modern biophotonics. The unique capability of optoacoustics for high resolution imaging of light absorption contrast in deep tissues can provide a natural and efficient feedback to control light delivery in scattering medium. While basic feasibility of using optoacoustic readings as a feedback mechanism for wavefront shaping has been recently reported, the suggested approaches may require long acquisition times making them challenging to be translated into realistic tissue environments. In an attempt to significantly accelerate dynamic wavefront shaping capabilities, we present here a feedback-based approach using real-time three-dimensional optoacoustic imaging assisted with genetic-algorithm-based optimization. The new technique offers robust performance in the presence of noisy measurements and can simultaneously control the scattered wave field in an entire volumetric region.Comment: 4 pages, 3 figure

Adiabatic Preparation of Topological Order

Topological order characterizes those phases of matter that defy a description in terms of symmetry and cannot be distinguished in terms local order parameters. This type of order plays a key role in the theory of the fractional quantum Hall effect, as well as in topological quantum information processing. Here we show that a system of n spins forming a lattice on a Riemann surface can undergo a second order quantum phase transition between a spin-polarized phase and a string-net condensed phase. This is an example of a phase transition between magnetic and topological order. We furthermore show how to prepare the topologically ordered phase through adiabatic evolution in a time that is upper bounded by O(\sqrt{n}). This provides a physically plausible method for constructing a topological quantum memory. We discuss applications to topological and adiabatic quantum computing.Comment: 4 pages, one figure. v4: includes new error estimates for the adiabatic evolutio

Job Stability in the United States

Two key attributes of a job are its wage and its duration. Much has been made of changes in the wage distribution in the 1980s, but little attention has been given to job durations since Hall (1982). We fill this void by examining the temporal evolution of job retention rates in U.S. labor markets, using data assembled from the sequence of Current Population Survey job tenure supplements. In contrast to the distribution of wages, which clearly changed in the 1980s, we find that job retention rates have remained stable.