Imports and welfare: variety losses of the Argentine crisis of 2001-2002

The access to a large variety of products is one of the main sources of gains from international trade and globalization. When an economy goes through a crisis, aggregate demand shrinks resulting in fewer product varieties being imported. In this paper we quantify short-run and medium-run welfare lo...

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Autores principales: Brambilla, Irene, Tomé, Romina
Formato: Objeto de conferencia
Lenguaje:Inglés
Publicado: 2011
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Acceso en línea:http://sedici.unlp.edu.ar/handle/10915/170439
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Sumario:The access to a large variety of products is one of the main sources of gains from international trade and globalization. When an economy goes through a crisis, aggregate demand shrinks resulting in fewer product varieties being imported. In this paper we quantify short-run and medium-run welfare losses that resulted from the reduction in the number of imported product varieties during the Argentine crisis of 2001-2002. We find that short-run welfare losses vary widely across products and that medium-run recovery depends on the ability to substitute towards new varieties.