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Burstein, Ariel T.

Overview
Works: 22 works in 167 publications in 1 language and 1,042 library holdings
Classifications: HB1, 330.072
Publication Timeline
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Publications about Ariel T Burstein
Publications by Ariel T Burstein
Most widely held works by Ariel T Burstein
Distribution costs and real exchange rate dynamics during exchange-rate-based-stabilizations by Ariel T Burstein( Book )
18 editions published between 2000 and 2001 in English and held by 108 libraries worldwide
This paper studies the role played by the distribution sector in shaping the behavior of the real exchange rate during exchange-rate-based-stabilizations. We use data for the U.S. and Argentina to document the importance of distribution margins in retail prices and disaggregated price data to study price dynamics in the aftermath of Argentina's 1991 Convertibility plan. Distribution services require local labor and land so they drive a natural wedge between retail prices in different countries. We study in detail the impact of introducing a distribution sector in an otherwise standard model of exchange-rate-based-stabilizations. We show that this simple extension improves dramatically the ability of the model to rationalize observed real exchange rate dynamics
Why are rates of inflation so low after large devaluations? by Ariel T Burstein( Book )
19 editions published between 2001 and 2002 in English and held by 103 libraries worldwide
This paper studies the behavior of inflation after nine large post-1990 contractionary devaluations. A salient feature of the data is that inflation is low relative to the rate of devaluation. We argue that distribution costs and substitution away from imports to lower quality local goods can account quantitatively for the post-devaluation behavior of prices
Investment prices and exchange rates : some basic facts by Ariel T Burstein( Book )
14 editions published in 2004 in English and held by 88 libraries worldwide
"This paper documents four basic facts about investment goods and investment prices. First, investment has a very significant nontradable component in the form of construction services. Second, distributions services (wholesaling, retailing, and transportation) are much less important for investment than for consumption. Third, the import content of investment is much larger than that of consumption. Finally, in the aftermath of three large devaluations, the rate of exchange rate pass-through is, perhaps not surprisingly, highest for imported equipment and lowest for construction services"--National Bureau of Economic Research web site
Modeling exchange-rate passthrough after large devaluations by Ariel T Burstein( Book )
13 editions published in 2005 in English and held by 81 libraries worldwide
"Large devaluations are generally associated with large declines in real exchange rates. We develop a model which embodies two complementary forces that account for the large declines in the real exchange rate that occur in the aftermath of large devaluations. The first force is sticky nontradable-goods prices. The second force is the impact of real shocks that often accompany large devaluations. We argue that sticky nontradable goods prices generally play an important role in explaining post-devaluation movements in real exchange rates. However, real shocks can sometimes be primary drivers of real exchange-rate movements"--National Bureau of Economic Research web site
Large devaluations and the real exchange rate by Ariel T Burstein( Book )
10 editions published in 2004 in English and held by 78 libraries worldwide
"In this paper we argue that the primary force behind the large drop in real exchange rates that occurs after large devaluations is the slow adjustment in the price of nontradable goods and services. Our empirical analysis uses data from five large devaluation episodes: Argentina (2001), Brazil (1999), Korea (1997), Mexico (1994), and Thailand (1997). We conduct a detailed analysis of the Argentina case using disaggregated CPI data, data from our own survey of prices in Buenos Aires, and scanner data from supermarkets. We assess the robustness of our findings by studying large real-exchange-rate appreciations, medium devaluations, and small exchange-rate movements"--National Bureau of Economic Research web site
The importance of nontradable goods' prices in cyclical real exchange rate fluctuations by Ariel T Burstein( Book )
13 editions published in 2005 in English and held by 74 libraries worldwide
"Changes in the price of nontradable goods relative to tradable goods account for roughly 50 percent of the cyclical movements in real exchange rates"--National Bureau of Economic Research web site
Prices and market shares in a menu cost model by Ariel T Burstein( file )
11 editions published in 2007 in English and held by 60 libraries worldwide
Pricing complementarities play a key role in determining the propagation of monetary disturbances in sticky price models. We propose a procedure to infer the degree of firm-level pricing complementarities in the context of a menu cost model of price adjustment using data on prices and market shares at the level of individual varieties. We then apply this procedure by calibrating our model (in which pricing complementarities are based on decreasing returns to scale at the variety level) using scanner data from a large grocery chain. Our data is consistent with moderately strong levels of firm-level pricing complementarities, but they appear too weak to generate much larger aggregate real effects from nominal shocks than a model without these complementarities
Innovation, firm dynamics, and international trade by Andrew Atkeson( file )
10 editions published between 2007 and 2010 in English and held by 51 libraries worldwide
We present a general equilibrium model of the decisions of firms to innovate and to engage in international trade. We use the model to analyze the impact of a reduction in international trade costs on firms' process and product innovative activity. We first show analytically that if all firms export with equal intensity, then a reduction in international trade costs has no impact at all, in steady-state, on firms' investments in process innovation. We then show that if only a subset of firms export, a decline in marginal trade costs raises process innovation in exporting firms relative to that of non-exporting firms. This reallocation of process innovation reinforces existing patterns of comparative advantage, and leads to an amplified response of trade volumes and output over time. In a quantitative version of the model, we show that the increase in process innovation is largely offset by a decline in product innovation. We find that, even if process innovation is very elastic and leads to a large dynamic response of trade, output, consumption, and the firm size distribution, the dynamic welfare gains are very similar to those in a model with inelastic process innovation
Foreign know-how, firm control, and the income of developing countries by Ariel T Burstein( file )
5 editions published in 2007 in English and held by 46 libraries worldwide
Managerial know-how shapes the productivity of firms by defining the set of available technologies, production choices, and market opportunities. This know-how can be reallocated across countries as managers acquire control of factors of production abroad. In this paper, we construct a quantitative model of cross-country income differences to study the aggregate consequences of international mobility of managerial know-how. We use the model and aggregate data to infer the relative scarcity of this form of know-how for a sample of developing countries. We also conduct policy counterfactuals and find that on average, developing countries gain up to 23% in output and 9% in consumption when they eliminate all barriers to foreign control of domestic factors of production
Pricing-to-market in a Ricardian model of international trade by Andrew Atkeson( Computer File )
7 editions published in 2007 in English and held by 46 libraries worldwide
"We study the implications for international relative prices of a simple Ricardian model of international trade with imperfect competition and variable markups, providing a tractable account of firm-level and aggregate prices. We show that both trade costs and imperfect competition with variable markups are needed to account for pricing-to-market at the firm and aggregate levels. We also show that international trade costs are essential, but pricing-to-market is not, to account for a high volatility of tradeable consumer prices relative to the overall CPI-based real-exchange rate"--NBER website
Trade, production sharing, and the international transmission of business cycles by Ariel T Burstein( file )
5 editions published in 2008 in English and held by 42 libraries worldwide
Countries that are more engaged in production sharing exhibit higher bilateral manufacturing output correlations. We use data on trade flows between US multinationals and their affiliates as well as trade between the United States and Mexican maquiladoras to measure production-sharing trade and its link with the business cycle. We then develop a quantitative model of international business cycles that generates a positive link between the extent of vertically integrated production-sharing trade and internationally synchronized business cycles. A key assumption in the model is a relatively low elasticity of substitution between home and foreign inputs in the production of the vertically integrated good
Trade liberalization and firm dynamics by Ariel T Burstein( file )
5 editions published between 2011 and 2013 in English and held by 38 libraries worldwide
In this paper, we analyze the transition dynamics associated with an economy's response to trade liberalization. We start by reviewing the recent literature that incorporates firm dynamics into models of international trade. We then build upon that literature to characterize the role of firm dynamics, export-market selection, firm-level innovation, and firms' expectations regarding the time path of liberalization in generating those transition dynamics following trade liberalization. These modeling ingredients generate substantial aggregate transition dynamics as they shift and shape the endogenous distribution of firms over time. Our results show how the responses of trade volumes, innovation, and aggregate output can vary greatly over time depending on those modeling ingredients. This has important consequences for many issues in international economics that rely on predictions for the effects of globalization over time on those key aggregate outcomes
Globalization, technology, and the skill premium a quantitative analysis by Ariel T Burstein( Computer File )
6 editions published in 2010 in English and held by 38 libraries worldwide
We construct a model of international trade and multinational production (MP) to examine the impact of globalization on the skill premium in skill-abundant and skill-scarce countries. The key mechanisms in our framework arise from the interaction between three elements: cross-country differences in factor endowments and sectoral productivities, technological heterogeneity across producers within sectors, and skill-biased technology. Reductions in trade and/or MP costs induce a reallocation of resources towards a country's comparative advantage sector (increasing the skill premium in skill-abundant countries and reducing it in skill-scarce countries) and within sectors towards more productive and skill-intensive producers (increasing the skill premium in all countries). We parameterize the model to match salient features of the extent and composition of trade and MP between the U.S. and skill-abundant and skill-scarce countries in 2006. We show that a reduction in trade and MP costs, moving from autarky to 2006 levels of trade and MP, increases the skill premium by roughly 5% in skill-abundant and skill-scarce countries. We also show that the growth in US trade and MP between 1966 and 2006 accounts for 1/9th of the 24% rise in the US skill premium over this period. MP is at least as important as international trade in generating this rise in the skill premium
Factor prices and international trade a unifying perspective by Ariel T Burstein( file )
4 editions published in 2011 in English and held by 37 libraries worldwide
How do trade liberalizations affect relative factor prices and to what extent do they cause factors to reallocate across sectors? We first present a general framework that nests a wide range of models that have been used to study the link between globalization and factor prices. Under some restrictions, changes in the "factor content of trade" are sufficient statistics for the impact of trade on relative factor prices. We then study the determination of the factor content of trade in a specific version of our general framework featuring imperfect competition, increasing returns to scale, and heterogeneous producers. We show how heterogeneous firms' decisions shape the factor content of trade, and, therefore, the impact of trade liberalization on relative factor prices and between-sector factor allocation
Aggregate implications of innovation policy by Andrew Atkeson( file )
6 editions published in 2011 in English and held by 35 libraries worldwide
We present a tractable model of innovating firms and the aggregate economy that we use to assess the link between the responses of firms to changes in innovation policy and the impact of those policy changes on aggregate output and welfare. We argue that the key theoretical determinant of the relative long-run aggregate impact of alternative policies is their impact on the expected profitability of entering firms. We show that, to a first-order approximation, a wide range of policy changes have a long-run aggregate impact in direct proportion to the fiscal expenditures on those policies, and that to evaluate the aggregate impact of such policy changes, there is no need to calculate changes in firms' decisions in response to these policy changes. We use these results to compare the relative magnitudes of the impact on aggregates in the long run of three innovation policies in the United States: the Research and Experimentation Tax Credit, federal expenditure on R & D, and the corporate profits tax. We argue that the corporate profits tax is a relatively important policy through its negative effects on innovation and physical capital accumulation that may well undo the benefits of federal support for R & D. We also use a calibrated version of our model to examine the absolute magnitude of the impact of these policies on aggregates. We show that, depending on the magnitude of spillovers, it is possible for changes in innovation policies to have a very large impact on aggregates in the long run. However, over a 15-year horizon, the impact of changes in innovation policies on aggregate output is not very sensitive to the magnitude of spillovers. On the basis of these results we conclude that, while it is possible to make comparisons about the relative importance of different policies and sharp predictions about their aggregate impact in the medium term, it is very difficult to shed much light on the implications of innovation policies for long-run aggregate outcomes and welfare without accurate estimates as to the magnitude of innovation spillovers
Importing skill-biased technology by Ariel T Burstein( file )
5 editions published in 2011 in English and held by 34 libraries worldwide
Capital equipment -- such as computers and industrial machinery -- embodies skill-biased technology, in the sense that it is complementary to skilled labor. Most countries import a large share of their capital equipment, and by doing so import skill-biased technology. In this paper we develop a tractable quantitative model of international trade in capital goods to quantify the extent to which trade, through capital-skill complementarity, raises the relative demand for skill and hence increases the skill premium. In one counterfactual, we find that moving from the trade levels observed in the year 2000 to autarky would decrease the skill premium by 16% in the median country in our sample, by 5% in the US, and by a much larger magnitude in countries that heavily rely on imported capital equipment
Measured aggregate gains from international trade by Ariel T Burstein( file )
4 editions published in 2012 in English and held by 33 libraries worldwide
Do theoretical welfare gains from trade translate into aggregate measures of economic activity? We calculate the changes in real GDP and real consumption that result from changes in trade costs in a range of workhorse trade models, following the procedures outlined by statistical agencies in the United States. Our main findings are as follows: First, real GDP and measured aggregate productivity rise in response to reductions in variable trade costs if GDP deflators capture the decline in trade costs. Second, with balanced trade in each country, changes in world real consumption and changes in world real GDP (i.e.: weighting the change in each country by its nominal GDP) in response to changes in variable trade costs coincide, up to a first-order approximation, with changes in world theoretical (welfare-based) consumption. The equivalence between measured consumption and theoretical consumption holds country-by-country under stronger conditions. Third, for given trade shares and changes in variable trade costs, changes in real GDP and changes in world real consumption are approximately equal in magnitude across the models we consider
International prices and exchange rates by Ariel T Burstein( file )
3 editions published in 2013 in English and held by 30 libraries worldwide
We survey the recent empirical and theoretical developments in the literature on the relation between prices and exchange rates. After updating some of the major findings in the empirical literature we present a simple framework to interpret this evidence. We review theoretical models that generate insensitivity of prices to exchange rate changes through variable markups, both under flexible prices and nominal rigidities, first in partial equilibrium and then in general equilibrium
Pricing-to-market, trade costs, and international relative prices by Andrew Atkeson( Book )
5 editions published between 2007 and 2008 in English and held by 16 libraries worldwide
Trade, production sharing and the international transmission of business cycles ( Computer File )
1 edition published in 2004 in English and held by 2 libraries worldwide
 
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Alternative Names
Burstein, A. 1974-
Burstein, A. T. 1974-
Burstein, Ariel.
Burstein, Ariel 1974-
Burstein, Ariel Thomas 1974-
Burstein, Ariel Tomas
Languages
English (164)
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