Trade Liberalization with Heterogenous Firms
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This paper is a substantially revised version of the Baldwin and Forslid (2004) working paper with an identical title. The present paper, however, also includes elements from Baldwin (2005), which has not and will not be submitted for publication anywhere. We are grateful for comments from Elhanan Helpman and Marc Melitz as well as other participants at ERWIT 2004. Any remaining errors are our own. Forslid thanks The Bank of Sweden Tercentenary Foundation (Reg. no. J2001-0684:1) for financial support.