Marc J. Melitz

Melitz developed a new approach to analysis of international trade that introduces firm heterogeneity into a model of monopolistic competition. His foundational Econometrica paper has close to 9,000 citations on Google Scholar. His paper revolutionized analysis of trade flows, determinants of sectoral productivity levels, and impacts of commercial policies. The major insight is that global competition induces exit by the least productive firms and reallocates market share to more productive firms in every industry. His research provides an explanation for many patterns found in the firm-level data. The so-called Melitz model has become a centerpiece of modern international trade theory.