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DTSTART:20070311T020000
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DTSTAMP:20260904T095932
DTSTART;TZID=America/Detroit:20260924T113000
DTEND;TZID=America/Detroit:20260924T125000
SUMMARY:Workshop / Seminar:Wealth Dynamics and Path Dependence
DESCRIPTION:This paper studies wealth dynamics and capital allocation under different trade regimes and shows that trade integration can make specialization history-dependent even when sectors have the same long-run productivity potential. I develop a dynamic multisector general equilibrium model with heterogeneous entrepreneurs facing persistent productivity shocks. Financial frictions make firms' ability to expand depend on their wealth\, which connects sectoral production and growth to wealth distribution. In a closed economy\, relative prices respond to scarcity: initially disadvantaged sectors become more profitable and catch up with initially favored sectors.\nIn an open economy\, international markets limit this price response\; initially favored sectors accumulate more wealth and account for larger long-run shares of production. I implement a quantitative analysis using data from Peruvian firms\, households\, national accounts\, tariffs\, and international trade to quantify how initial wealth allocation shapes sectoral specialization and how domestic and foreign trade policies affect its persistence.
UID:151563-21911767@events.umich.edu
URL:https://events.umich.edu/event/151563
CLASS:PUBLIC
STATUS:CONFIRMED
CATEGORIES:Economics,International,seminar
LOCATION:North Quad - 4325
CONTACT:
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