Title: Teams of rivals
Description: "We show that an ostensibly disparate set of stylized facts regarding firm pricing behavior can arise in a Ricardian model with Bertrand competition.  Generalizing the Bernard, Eaton, Jenson, and Kortum (2003) model allows firms' markups over marginal cost to fall under trade liberalization, but increase with FDI, matching empirical studies in international trade, generate the existence of pricing-to-market and imperfect pass-through, and capture stylized facts regarding the frequency and synchronization of price adjustment across markets.  The result is a well specified distribution for markups that previously could only be seen numerically and a way to quantify endogenous pricing rigidities emerging from a market structure governed by fierce competition among rivals"--National Bureau of Economic Research web site.