Can Comparative Advantage Explain the Growth of US Trade
Bibliographic Data
| ID | 9709323 |
|---|---|
| Authors | Alejandro Cuñat (0000-0003-4828-704X, University of Essex, CEP and CEPR Università Bocconi and IGIER), Marco Maffezzoli (0000-0003-1966-4256, University of Essex, CEP and CEPR Università Bocconi and IGIER) |
| Year | 2007 |
| Volume | 117 |
| Issue | 520 |
| Pages | 583-602 |
| Publication date | 2007-04-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1111/j.1468-0297.2007.02042.x |
| OpenAlex | W1520718344 |
| Language | EN |
| Citations received | 1 |
| References cited | 32 |
We present a dynamic comparative advantage model in which moderate reductions in trade costs can generate sizable increases in trade volumes over time. A fall in trade costs has two effects on the volume of trade. First, for given factor endowments, it raises the degree of specialization of countries, leading to a larger volume of trade in the short run. Second, it raises the factor price of each country’s abundant production factor, leading to diverging paths of relative factor endowments across countries and a rising degree of specialization. A simulation exercise shows that a fall in trade costs over time produces a non-linear increase in the trade share of output as in the data. Even when elasticities of substitution are not particularly high, moderate reductions in trade costs lead to large trade volumes over time. We present further empirical evidence in favour of our approach, documenting the link between trade liberalization and the cross-country divergence of investment shares
Comparative advantage · Economic integration · Economics · International economics · International trade · Microeconomics · Production (economics · Trade barrier · Trade volume · Firm Innovation and Growth · Global Trade and Competitiveness · Global trade and economics
Factor Proportions and the Structure of Commodity Trade
Across-Product Versus Within-Product Specialization in International Trade
The growth of world trade
Export Versus FDI with Heterogeneous Firms
Time to Build and Aggregate Fluctuations
On the mechanics of economic development
Frontiers of Business Cycle Research
Reconciling Alternative Estimates of the Elasticity of Substitution
The Two Faces of Globalization
Intertemporal Substitution in Consumption
International Factor Price Differences
Factor Price Equalization in a Dynamic Economy
Can Vertical Specialization Explain the Growth of World Trade
Factor Proportions and Comparative Advantage in the Long Run
| Unique citing works | 1 |
|---|---|
| Citations per year | 0,09 |
| Citation span | 2015 - 2015 (1) |
| Citation velocity | historical |
| Highly cited | No |
| Citation types | Neutral: 1 |