I am an economist at the Kiel Institute for the World Economy and the CAU Kiel. I am also associated with the Economics Department at the University of Oslo. Previously, I worked for the Macroeconomics Group at Statistics Norway. My research interests include topics in international trade, international investment, migration, and economic networks and I am the head of the Research Center for Trade Policy at the Kiel Institute.
I develop a general equilibrium trade model, with risk-averse investors and international capital flows, to show that the correlation pattern of demand shocks across countries constitutes a motive for goods trade that persists even if financial markets are complete. I estimate the risk-augmented gravity equation implied by the model and find support for the prediction that, conditional on trade costs and market size, exporters sell smaller quantities to countries whose shocks contribute more to aggregate volatility. A counterfactual analysis shows that the risk-diversification motive accounts for 7.5% of global trade. Country-level exports would grow by -19% to +9% if all diversification opportunities were eliminated, entailing welfare losses in the range of .3% to 16%.
[CEPR Discussion Paper No. 14230] [Latest version]
Reject&Resubmit Journal of International Economics.
This paper examines the structure of the shipping network and its implications on global trade and welfare. Using novel data on the movements of container ships, we calculate optimal travel routes. We then estimate the impact of a shock to the network on global trade by means of a natural experiment: the 2016 Panama Canal expansion. Trade between country pairs using the canal increased by 9-10% after the expansion. While the building costs were borne by Panama alone, a model-based quantification shows that the welfare gains were shared by many countries, due to the network structure of shipping. [VoxEU][CEPR Discussion Paper No. 14193][Latest version]
Journal of International Economics, 138(2022)-103647. [Link][Data and code][Preprint]
A previous version of this paper circulated under the title Undoing Europe in a New Quantitative Trade Model.
European Economic Review, Volume 144-104077(2022). [Link][Data and code][CESifo Working Paper No. 7355, 2018]
International Economics and Economic Policy, 25–72(2021). [CESifo Working Paper No. 5176, 2015]
Journal of International Economics, 115, 2018, 130-144. [Preprint][Online appendix] [Data and code]
Jahrbücher für Nationalökonomie und Statistik / Journal of Economics and Statistics, 236(6), 2016, 639–664. [ifo Working Paper No. 220, 2016]
in Baldwin, R. E. and S. J. Evenett (eds), Revitalising Multilateralism: Pragmatic Ideas for the New WTO Director-General, a VoxEU.org eBook, CEPR Press, 2020. [Link]
in Baldwin, R. E. and S. J. Evenett (eds), COVID-19 and Trade Policy: Why Turning Inward Won’t Work, a VoxEU.org eBook, CEPR Press, 2020. [Link to eBook] [VoxEU] Media coverage: [Finansavisen.no]
ifo Beiträge zur Wirtschaftsforschung 74, ifo Institute, 2017. [PDF]