Fixed Export Cost heterogeneity, Trade and Welfare

Recent literature on the workhorse model of intra-industry trade has explored heterogeneous cost structures at the firm level. These approaches have proven to add realism and predictive power. This paper presents a new and simple heterogeneous-firms specification. We develop a symmetric two-country intra-industry trade model where firms are of two different marginal costs types and where fixed export costs are heterogeneous across firms. This model traces many of the stylized facts of international trade. However, we find that with heterogeneous fixed export costs there exists a positive bilateral tariff that maximizes national and world welfare.Intra-industry trade, trade liberalization, monopolistic competition, heterogeneous firms,welfare, protectionism

Reductions in Real versus Tariff Barriers: The Effects on Industry Concentration

Economic integration in Europe has had ambiguous effects on industry concentration. The literature has proposed various explanations of the empirical findings. The present paper provides an additional theoretical argument. We show that in a world of monopolistic competition, integration in it self (modelled as a reduction of trade barriers) generates opposing effects on industry concentration, depending on wether the barrier is a real (frictional) or a tariff cost. In particular, the Herfindahl index of industry concentration falls for a reduction in real costs, but rises for a reduction in tariff costs. The reason is that real barriers burn up resources, such that industry profitability is reduced, reducing entry, and resulting in fewer firms and higher concentration. Under a tariff barrier, the redistributed tariff revenue stabilises industry profitability, resulting in more firms and lower concentration.real costs; tariff costs; industry concentration; market structure; integration

Cell-wall structural changes in wheat straw pretreated for bioethanol production

Abstract Background Pretreatment is an essential step in the enzymatic hydrolysis of biomass and subsequent production of bioethanol. Recent results indicate that only a mild pretreatment is necessary in an industrial, economically feasible system. The Integrated Biomass Utilisation System hydrothermal pretreatment process has previously been shown to be effective in preparing wheat straw for these processes without the application of additional chemicals. In the current work, the effect of the pretreatment on the straw cell-wall matrix and its components are characterised microscopically (atomic force microscopy and scanning electron microscopy) and spectroscopically (attenuated total reflectance Fourier transform infrared spectroscopy) in order to understand this increase in digestibility. Results The hydrothermal pretreatment does not degrade the fibrillar structure of cellulose but causes profound lignin re-localisation. Results from the current work indicate that wax has been removed and hemicellulose has been partially removed. Similar changes were found in wheat straw pretreated by steam explosion. Conclusion Results indicate that hydrothermal pretreatment increases the digestibility by increasing the accessibility of the cellulose through a re-localisation of lignin and a partial removal of hemicellulose, rather than by disruption of the cell wall.</p

Fixed Export Cost heterogeneity, Trade and Welfare

Recent literature on the workhorse model of intra-industry trade has explored heterogeneous cost structures at the firm level. These approaches have proven to add realism and predictive power. This paper presents a new and simple heterogeneous-firms specification. We develop a symmetric two-country intra-industry trade model where firms are of two different marginal costs types and where fixed export costs are heterogeneous across firms. This model traces many of the stylized facts of international trade. However, we find that with heterogeneous fixed export costs there exists a positive bilateral tariff that maximizes national and world welfare

Reductions in Real versus Tariff Barriers: The Effects on Industry Concentration

Economic integration in Europe has had ambiguous effects on industry concentration. The literature has proposed various explanations of the empirical findings. The present paper provides an additional theoretical argument. We show that in a world of monopolistic competition, integration in it self (modelled as a reduction of trade barriers) generates opposing effects on industry concentration, depending on wether the barrier is a real (frictional) or a tariff cost. In particular, the Herfindahl index of industry concentration falls for a reduction in real costs, but rises for a reduction in tariff costs. The reason is that real barriers burn up resources, such that industry profitability is reduced, reducing entry, and resulting in fewer firms and higher concentration. Under a tariff barrier, the redistributed tariff revenue stabilises industry profitability, resulting in more firms and lower concentration

Reductions in Real versus Tariff Barriers: The Effects on Industry Concentration

Economic integration in Europe has had ambiguous effects on industry concentration. The literature has proposed various explanations of the empirical findings. The present paper provides an additional theoretical argument. We show that in a world of monopolistic competition, integration in it self (modelled as a reduction of trade barriers) generates opposing effects on industry concentration, depending on wether the barrier is a real (frictional) or a tariff cost. In particular, the Herfindahl index of industry concentration falls for a reduction in real costs, but rises for a reduction in tariff costs. The reason is that real barriers burn up resources, such that industry profitability is reduced, reducing entry, and resulting in fewer firms and higher concentration. Under a tariff barrier, the redistributed tariff revenue stabilises industry profitability, resulting in more firms and lower concentration