NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Michael Peters

Department of Economics
Yale University
28 Hillhouse Avenue
New Haven, CT 06511
Tel: 203/436-8475

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NBER Program Affiliations: EFG
NBER Affiliation: Faculty Research Fellow

NBER Working Papers and Publications

January 2016Lack of Selection and Limits to Delegation: Firm Dynamics in Developing Countries
with Ufuk Akcigit, Harun Alp: w21905
Firm dynamics in poor countries show striking differences to those of rich countries. While few firms indeed experience growth as they age, most firms are simply stagnant in that they neither exit nor expand. We interpret this fact as a lack of selection, whereby producers with little growth potential survive because innovative entrepreneurs do not expand enough to force them out of the market. To explain these differences, we develop a theory whereby firms require managerial inputs for production and countries differ in their managerial delegation possibilities. If delegation of managerial tasks to outside managers is difficult in poor countries, entrepreneurs are forced to rely on their own time to supply managerial services. Improvements in the efficiency of delegation will raise the re...
August 2015The Gains from Input Trade in Firm-Based Models of Importing
with Joaquin Blaum, Claire LeLarge: w21504
Trade in intermediate inputs allows firms to lower their costs of production by using better, cheaper, or novel inputs from abroad. Quantifying the aggregate impact of input trade, however, is challenging. As importing firms differ markedly in how much they buy in foreign markets, results based on aggregate models do not apply. We develop a methodology to quantify the gains from input trade for a class of firm-based models of importing. We derive a sufficiency result: the change in consumer prices induced by input trade is fully determined from the joint distribution of value added and domestic expenditure shares in material spending across firms. We provide a simple formula that can be readily evaluated given the micro-data. In an application to French data, we find that consumer prices o...
 
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