@techreport{NBERw10718,
 title = "The Impact of Trade on Intraindustry Reallocation and Aggregate Industry Productivity: A Comment",
 author = "Richard E. Baldwin and Frederic Robert-Nicoud",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "10718",
 year = "2004",
 month = "August",
 URL = "http://www.nber.org/papers/w10718",
 abstract = {Melitz (2003) demonstrates that greater trade openness raises industry productivity via a selection effect and via a production re-allocation effect. Our comment points out that the set-up assumed in the Melitz model displays a trade off between static and dynamic efficiency gains. That is, although freer trade improves industry productivity in a level sense, it harms it in a growth sense. To make this point as simply as possible, we introduce a slight modification to the model that endogenises the growth rate of industry productivity and we show that liberalisation slows growth.},
}