Measuring the unequal gains from trade

Pablo D. Fajgelbaum, Amit K. Khandelwal

Research output: Contribution to journalArticle

54 Scopus citations

Abstract

Individuals that consume different baskets of goods are differentially affected by relative price changes caused by international trade. We develop a methodology to measure the unequal gains from trade across consumers within countries. The approach requires data on aggregate expenditures and parameters estimated from a nonhomothetic gravity equation. We find that trade typically favors the poor, who concentrate spending in more traded sectors.

Original languageEnglish (US)
Pages (from-to)1113-1180
Number of pages68
JournalQuarterly Journal of Economics
Volume131
Issue number3
DOIs
StatePublished - Aug 1 2016
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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