Authors
Timothy J. Kehoe
Consultant, University of Minnesota, and National Bureau of Economic Research
Pau S. Pujolàs
McMaster University
Kim J. Ruhl
University of Wisconsin and National Bureau of Economic Research
The Opportunity Costs of Entrepreneurs in International Trade
Abstract
We show that a trade model with an exogenous set of heterogeneous firms with fixed operating costs has the same aggregate outcomes as a span-of-control model. Fixed costs in the heterogeneous-firm model are entrepreneurs' forgone wage in the span-of-control model.
Published in: _Economics Letters_ (Vol. 146, 2016, pp. 01-03) https://doi.org/10.1016/j.econlet.2016.07.012.
