This paper offers new insights on a central question in trade and development economics: does increased exposure to foreign competition generate gains in plant productivity? We find that it does. We examine Colombian trade policy from 1977 to 1991, a period during which trade liberalization...

This paper is a first step toward a more fundamental theory of political economy outcomes. We start from the fundamentals of the economy, given by preferences and technology; further, we specify all available technologies for the control of resources — such as armed forces or bribing. We model...