Productivity and Firm Selection: Quantifying the “New” Gains from Trade

We discuss how standard computable equilibrium models of trade policy can be enriched with selection effects without missing other important channels of adjustment. This is achieved by estimating and simulating a partial equilibrium model that accounts for a number of real world effects of trade liberalisation: richer availability of product varieties; tougher competition and weaker market power of firms; better exploitation of economies of scale; and, of course, efficiency gains via the selection of the most efficient firms. The model is estimated on E.U. data and simulated in counterfactual scenarios that capture several dimensions of European integration. Simulations suggest that the gains from trade are much larger in the presence of selection effects. Even in a relatively integrated economy as the E.U., dismantling residual trade barriers would deliver relevant welfare gains stemming from lower production costs, smaller markups, lower prices, larger firm scale and richer product variety. We believe our analysis provides enough ground to support the inclusion of firm heterogeneity and selection effects in the standard toolkit of trade policy evaluation.European Integration, Firm-level Data, Firm Selection, Gains from Trade, Total Factor Productivity

Productivity and firm selection: intra- vs international trade

Recent theoretical models predict gains from international trade coming from intra-industry reallocations, due to a firm selection effect. In this paper we answer two related questions. First, what is the magnitude of this selection effect, and how does it compare to that of intra-national trade? Second, would the removal of 'behind-the-border' trade frictions between integrated EU countries lead to large productivity gains? To answer these questions, we extend and calibrate the Melitz and Ottaviano (2007) model on productivity and trade data for European economies in 2000, and simulate counterfactual trade liberalization scenarios. We consider 11 EU countries and a total of 31 economies, including 21 French regions. Our first result is that, in the French case, international trade has a sizeable impact on aggregate productivity, but smaller than that of intra-national trade. Second, substantial productivity gains (around 20%) can be expected from 'behind-the-border' integration. In both experiments, we predict the corresponding variations in average prices, markups, quantities and profits. We show that the model fits sales and exports data reasonably well, and we perform a number of robustness checks. We also suggest some explanations for the substantial cross-economy and cross-industry variations in our estimates of productivity gains, highlighting the importance of accessibility and competitiveness.European integration, intra-national trade, firm-level data, firm selection, gains from trade, total factor productivity

Thermodynamic and gravitational instability on hyperbolic spaces

We study the properties of anti--de Sitter black holes with a Gauss-Bonnet term for various horizon topologies (k=0, \pm 1) and for various dimensions, with emphasis on the less well understood k=-1 solution. We find that the zero temperature (and zero energy density) extremal states are the local minima of the energy for AdS black holes with hyperbolic event horizons. The hyperbolic AdS black hole may be stable thermodynamically if the background is defined by an extremal solution and the extremal entropy is non-negative. We also investigate the gravitational stability of AdS spacetimes of dimensions D>4 against linear perturbations and find that the extremal states are still the local minima of the energy. For a spherically symmetric AdS black hole solution, the gravitational potential is positive and bounded, with or without the Gauss-Bonnet type corrections, while, when k=-1, a small Gauss-Bonnet coupling, namely, \alpha << {l}^2 (where l is the curvature radius of AdS space), is found useful to keep the potential bounded from below, as required for stability of the extremal background.Comment: Shortened to match published (PRD) version, 18 pages, several eps figure

Brane cosmology with curvature corrections

We study the cosmology of the Randall-Sundrum brane-world where the Einstein-Hilbert action is modified by curvature correction terms: a four-dimensional scalar curvature from induced gravity on the brane, and a five-dimensional Gauss-Bonnet curvature term. The combined effect of these curvature corrections to the action removes the infinite-density big bang singularity, although the curvature can still diverge for some parameter values. A radiation brane undergoes accelerated expansion near the minimal scale factor, for a range of parameters. This acceleration is driven by the geometric effects, without an inflaton field or negative pressures. At late times, conventional cosmology is recovered.Comment: RevTex4, 8 pages, no figures, minor change

On the thin-shell limit of branes in the presence of Gauss-Bonnet interactions

In this paper we study thick-shell braneworld models in the presence of a Gauss-Bonnet term. We discuss the peculiarities of the attainment of the thin-shell limit in this case and compare them with the same situation in Einstein gravity. We describe the two simplest families of thick-brane models (parametrized by the shell thickness) one can think of. In the thin-shell limit, one family is characterized by the constancy of its internal density profile (a simple structure for the matter sector) and the other by the constancy of its internal curvature scalar (a simple structure for the geometric sector). We find that these two families are actually equivalent in Einstein gravity and that the presence of the Gauss-Bonnet term breaks this equivalence. In the second case, a shell will always keep some non-trivial internal structure, either on the matter or on the geometric sectors, even in the thin-shell limit.Comment: 17 pages, 2 figures, RevTeX 4. Revised version accepted for publication in Physical Review

Gauss-Bonnet Black Holes in dS Spaces

We study the thermodynamic properties associated with black hole horizon and cosmological horizon for the Gauss-Bonnet solution in de Sitter space. When the Gauss-Bonnet coefficient is positive, a locally stable small black hole appears in the case of spacetime dimension $d=5$, the stable small black hole disappears and the Gauss-Bonnet black hole is always unstable quantum mechanically when $d \ge 6$. On the other hand, the cosmological horizon is found always locally stable independent of the spacetime dimension. But the solution is not globally preferred, instead the pure de Sitter space is globally preferred. When the Gauss-Bonnet coefficient is negative, there is a constraint on the value of the coefficient, beyond which the gravity theory is not well defined. As a result, there is not only an upper bound on the size of black hole horizon radius at which the black hole horizon and cosmological horizon coincide with each other, but also a lower bound depending on the Gauss-Bonnet coefficient and spacetime dimension. Within the physical phase space, the black hole horizon is always thermodynamically unstable and the cosmological horizon is always stable, further, as the case of the positive coefficient, the pure de Sitter space is still globally preferred. This result is consistent with the argument that the pure de Sitter space corresponds to an UV fixed point of dual field theory.Comment: Rextex, 17 pages including 8 eps figures, v2: minor changes, to appear in PRD, v3: references adde

Scalar brane backgrounds in higher order curvature gravity

We investigate maximally symmetric brane world solutions with a scalar field. Five-dimensional bulk gravity is described by a general lagrangian which yields field equations containing no higher than second order derivatives. This includes the Gauss-Bonnet combination for the graviton. Stability and gravitational properties of such solutions are considered, and we particularily emphasise the modifications induced by the higher order terms. In particular it is shown that higher curvature corrections to Einstein theory can give rise to instabilities in brane world solutions. A method for analytically obtaining the general solution for such actions is outlined. Genericaly, the requirement of a finite volume element together with the absence of a naked singularity in the bulk imposes fine-tuning of the brane tension. A model with a moduli scalar field is analysed in detail and we address questions of instability and non-singular self-tuning solutions. In particular, we discuss a case with a normalisable zero mode but infinite volume element.Comment: published versio

Six-dimensional Abelian vortices with quadratic curvature self-interactions

Six-dimensional Nielsen-Olesen vortices are analyzed in the context of a quadratic gravity theory containing Euler-Gauss-Bonnet self-interactions. The relations among the string tensions can be tuned in such a way that the obtained solutions lead to warped compactification on the vortex. New regular solutions are possible in comparison with the case where the gravity action only consists of the Einstein-Hilbert term. The parameter space of the model is discussedComment: 28 pages in Latex style with 11 figure

Localized gravity and mass hierarchy in D=6 with the Gauss-Bonnet term

We obtain the localized gravity on the intersection of two orthogonal non-solitonic or solitonic 4-branes in D=6 in the presence of the Gauss-Bonnet term. The tension of the intersection is allowed to exist unlike the case without the Gauss-Bonnet term. We show that gravity could be confined to the solitonic 4-branes for a particular choice of the Gauss-Bonnet coupling. If the extra dimensions are compactified with the $T^2/(Z_2\times Z_2)$ orbifold symmetry, the mass hierarchy between the Planck scale and the weak scale can be explained by putting our universe at the TeV intersection of positive tension located at the orbifold fixed point.Comment: Latex file of 12 page

A Note on Inflation with Tachyon Rolling on the Gauss-Bonnet Brane

In this paper we study the tachyonic inflation in brane world cosmology with Gauss-Bonnet term in the bulk. We obtain the exact solution of slow roll equations in case of exponential potential. We attempt to implement the proposal of Lidsey and Nunes, astro-ph/0303168, for the tachyon condensate rolling on the Gauss-Bonnet brane and discuss the difficulties associated with the proposal.Comment: RevTex4, 5 pages, no figures, Minor clarifications added and references updated, To appear in PR