Research

Working Ongoing

* Climate change, comparative advantages, and structural transformation in agriculture, with Bruno Larue. JMP [Paper]
International trade literature often focuses heavily on the production side of general equilibrium, leaving several empirical puzzles unresolved. For instance, there is significant variation in income elasticities of food demand across products and countries. In this paper, we develop a general equilibrium Ricardian model of trade that allows for variation in the income elasticity of demand for agri-food products. We use this model to quantify the macro-level consequences of climate change under non-homothetic preferences. Despite heterogeneity, our findings indicate that climate change induces a 0.06 percent decrease in global welfare, which is considerably lower than the 0.26 percent decrease observed when income effects are not considered. Additionally, lower-middle-income countries are found to be especially vulnerable to climate change.

* Productivity, markups, and the role of climate change, with Lota Tamini. [Paper]
We employ a detailed establishment-level dataset from Canada to explore the role of climate shocks as a persistent determinant of heterogeneity in firm-level productivity and markups. Our results indicate that climate shocks reduce sales and average productivity among firms in sectors experiencing decreasing returns to scale. We also find that the ability of small firms to raise prices above marginal cost exceeds that of large firms. An increase in markup dispersion is associated with lower total factor productivity. In the model, firms with low marginal costs set higher markups, and their markups increase more after climate shocks.

* Climate change, Agricultural market uncertainty, and the Network structure of trade, with Lota Tamini.