When firm j is a supplier to firm i, firm i is a customer of firm j.
All workers located below her will work for firm i as their transport costs are lower; the others will work for firm i+1.
In order to work, Reds and Greens have to go to a firm i.
IndOrdLoss Firms reporting ordinary losses(_{mathrm{t}})/Total firms of the firm i industrial sector.
where I i(t−1) means information about firm i available up to time t-1.
Let w hi denote the wage offered by firm i to workers in group h.
where d i =d if firm i is prejudiced and 0 otherwise.
However, firm i is not alone on the market and workers compare the net wages offered by every firm and will work for firm i only if the net wage there is the highest.
In particular, (y_{is}^{1}) is the outcome if firm i receives a shock while (y_{is}^{0}) denotes the outcome of firm i if it does not receive the shock.
We have information on whether firm i purchases something from firm j, but no information on the amount of output j purchased by firm i; this is the thickness of each customer link.
This means that they compare the wage set by firm i minus the transport cost to work at i to that offered by firm i+1 minus the commuting cost of working at i+1.
