Amit Khandelwal

Measuring the Unequal Gains from Trade

Coauthor(s): Pablo Fajgelbaum.


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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 non-homothetic gravity equation. We find that trade typically favors the poor, who concentrate spending in more traded sectors.

Exact Citation:
Fajgelbaum, Pablo, and Amit Khandelwal. "Measuring the Unequal Gains from Trade." Columbia Business School, August 2015.
Date: 8 2015