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dc.contributor.authorBroda, Christianen_US
dc.contributor.authorWeinstein, Daviden_US
dc.date.accessioned2012-08-17T14:25:19Z-
dc.date.available2012-08-17T14:25:19Z-
dc.date.issued2004en_US
dc.identifier.urihttp://hdl.handle.net/10419/60555-
dc.description.abstractSince the seminal work of Krugman, product variety has played a central role in models of trade and growth. In spite of the general use of love-of-variety models, there has been no systematic study of how the import of new varieties has contributed to national welfare gains in the United States. In this paper, we show that the unmeasured growth in product variety from U.S. imports has been an important source of gains from trade over the last three decades (1972-2001). Using extremely disaggregated data, we show that the number of imported product varieties has increased by a factor of four. We also estimate the elasticities of substitution for each available category at the same level of aggregation and describe their behavior across time and SITC-5 industries. Using these estimates, we develop an exact price index and find that the upward bias in the conventional import price index is approximately 1.2 percent per year. The magnitude of this bias suggests that the welfare gains from variety growth in imports alone are 2.8 percent of GDP.en_US
dc.language.isoengen_US
dc.publisherFederal Reserve Bank of New York New York, NYen_US
dc.relation.ispartofseriesStaff Report, Federal Reserve Bank of New York 180en_US
dc.subject.jelF0en_US
dc.subject.jelF1en_US
dc.subject.jelF4en_US
dc.subject.ddc330en_US
dc.subject.stwProduktdifferenzierungen_US
dc.subject.stwAußenwirtschaftstheorieen_US
dc.subject.stwWohlfahrtsanalyseen_US
dc.subject.stwPreisindexen_US
dc.subject.stwSubstitutionselastizitäten_US
dc.subject.stwTheorieen_US
dc.titleGlobalization and the gains from varietyen_US
dc.typeWorking Paperen_US
dc.identifier.ppn389504254en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Staff Reports, Federal Reserve Bank of New York

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