Distortions and the Structure of the World Economy

We model the world economy as one system of endogenous input-output relationships subject to frictions and study how the world’s input-output structure and world’s GDP change due to changes in frictions. We derive a sufficient statistic to identify frictions from the observed world input-output matrix, which we fully match for the year 2011. We show how changes in internal frictions impact the whole structure of the world’s economy and that they have a much larger effect on world’s GDP than external frictions. We also use our approach to study the role of internal frictions during the Great Recession of 2007–2009. (JEL D57, E16, E23, E32, F41, G01)

This is the accepted manuscript version of Lorenzo Caliendo, Fernando Parro, and Aleh Tsyvinski, "Distortions and the Structure of the World Economy," American Economic Journal: Macroeconomics (forthcoming).

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Work Title Distortions and the Structure of the World Economy
Access
Open Access
Creators
  1. Lorenzo Caliendo
  2. Fernando Parro
  3. Aleh Tsyvinski
License In Copyright (Rights Reserved)
Work Type Article
Publisher
  1. American Economic Association
Publication Date October 1, 2022
Publisher Identifier (DOI)
  1. 10.1257/mac.20190410
Source
  1. American Economic Journal: Macroeconomics
Deposited November 11, 2022

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  • Created

    November 11, 2022 15:19 by Scholarly Communications and Copyright

  • Added CPT-1.pdf

    November 11, 2022 15:19 by Scholarly Communications and Copyright

  • Added Creator Lorenzo Caliendo

    November 11, 2022 15:19 by Scholarly Communications and Copyright

  • Added Creator Fernando Parro

    November 11, 2022 15:19 by Scholarly Communications and Copyright

  • Added Creator Aleh Tsyvinski

    November 11, 2022 15:19 by Scholarly Communications and Copyright

  • Published

    November 11, 2022 15:19 by Scholarly Communications and Copyright

  • Updated Description Show Changes

    December 13, 2022 12:54 by xzx1

    Description
    • <jats:p> We model the world economy as one system of endogenous input-output relationships subject to frictions and study how the world’s input-output structure and world’s GDP change due to changes in frictions. We derive a sufficient statistic to identify frictions from the observed world input-output matrix, which we fully match for the year 2011. We show how changes in internal frictions impact the whole structure of the world’s economy and that they have a much larger effect on world’s GDP than external frictions. We also use our approach to study the role of internal frictions during the Great Recession of 2007–2009. (JEL D57, E16, E23, E32, F41, G01) </jats:p>
    • We model the world economy as one system of endogenous input-output relationships subject to frictions and study how the world’s input-output structure and world’s GDP change due to changes in frictions. We derive a sufficient statistic to identify frictions from the observed world input-output matrix, which we fully match for the year 2011. We show how changes in internal frictions impact the whole structure of the world’s economy and that they have a much larger effect on world’s GDP than external frictions. We also use our approach to study the role of internal frictions during the Great Recession of 2007–2009. (JEL D57, E16, E23, E32, F41, G01)
  • Updated

    April 04, 2024 10:21 by [unknown user]