Capital Services in Global Value Chains
(Updated Nov 2025)
Revised and resubmitted, Quarterly Journal of Economics
Abstract: This paper constructs the first global dataset on inter-sectoral capital service expenditures. I use this data to disaggregate capital services and intermediate inputs in a dynamic multi-sector model of global production and trade. Steady state allocations and responses to shocks are determined by a capital-augmented global input-output matrix. Two properties of the measured network deliver larger long-run consumption gains from globalization than existing estimates, as well as larger gains in more capital-intensive countries. First, more trade-exposed sectors supply capital to more consumption-influential producers. Second, heterogeneity in the network reallocates sectoral expenditures towards producers with larger declines in capital rental prices. These reallocations raise capital incomes and lower consumption price indices.
Winner of the 2024 Philippe Martin Award
Presentations (very early versions):
Virtual International Trade and Macro Seminar, May 2022
National Academy of Sciences Workshop on Innovation GVCs, and Globalization, May 2021
Global Production Networks in Transition
(New Nov 2025; preliminary and incomplete)
I develop and implement a fast computational algorithm to solve for exact transition dynamics in a multi-sector, multi-country neoclassical growth model. The algorithm is equipped to handle specifications with linear capital accumulation, multiple types of capital and arbitrary sectoral input-output linkages in both capital services and intermediate inputs. Despite increased model heterogeneity, the ratio of forgone consumption along the transition path relative to consumption in steady-state is similar to one-sector models.
Industry Linkages from Joint Production
(Updated Dec 2025)
Under review
Abstract: I present evidence and theory on joint production in U.S. manufacturing. Higher demand in one industry raises a firm’s sales in another the more that the two industries share knowledge inputs like R&D. I estimate that knowledge inputs contribute to economies of scope through their scalability and partial non-rivalry within the firm. On average economies of scope cause aggregate producer prices to fall by one percent for every ten percent increase in output. More knowledge-intensive and export-intensive industries have higher scope economies and are disproportionately exposed to policies like tariffs that affect market size.
Winner of the 2020 WTO Essay Award for Young Economists
Media coverage: Colloquy
Structural Change within versus Across Firms: Evidence from the United States
(Updated May 2022, joint with Teresa Fort, Stephen Redding, and Peter Schott)
Abstract: We document the role of intangible capital in manufacturing firms’ substantial contribution to non-manufacturing employment growth from 1977-2019. Exploiting data on firms’ “auxiliary” establishments, we develop a novel measure of proprietary in-house knowledge and show that it is associated with increased growth and industry switching. We rationalize this reallocation in a model where firms combine physical and knowledge inputs as complements, and where producing the latter in-house confers a sector-neutral productivity advantage facilitating within-firm structural transformation. Consistent with the model, manufacturing firms with auxiliary employment pivot towards services in response to a plausibly exogenous decline in their physical input prices.
The Costs of Market Disintegration: Evidence from the India-Pakistan Border
(in progress, joint with Robin Burgess, Dave Donaldson, and Stephen Redding)
Foreign Direct Investment, Trade Finance and Global Value Chain Integration
(joint with Marc Auboin and Zhengrui Cheng)
published in: Chapter 6, World Trade Organization Global Value Chain Development Report 2025, edited by Robert Koopman