Stolper–Samuelson Revisited: Trade And Distribution With Oligopolistic Profits
AbstractThis paper investigates the distributional impact of international trade when goods markets are oligopolistic and firms partially pass-through changes in tariffs into prices and factor costs for differentiated products. Trade liberalization raises mark-ups and profit shares in the export industry and lowers them in the import-competing industry, while Stolper-Samuelson effects on real prices of primary factors are attenuated or possibly reversed. An extended model shows how "offshoring" (trade in intermediate goods) can potentially increase mark-ups for oligopolistic producers of final goods. The analysis illuminates why business interests generally support trade liberalization policies today, regardless of their countries' factor abundance.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Wiley Blackwell in its journal Metroeconomica.
Volume (Year): 63 (2012)
Issue (Month): 3 (07)
Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0026-1386
Other versions of this item:
- Robert A. Blecker, 2012. "Stolper-Samuelson Revisited: Trade and Distribution with Oligopolistic Profits," Working Papers 2012-06, American University, Department of Economics.
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- D33 - Microeconomics - - Distribution - - - Factor Income Distribution
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Feinberg, Robert M, 1989. "The Effects of Foreign Exchange Movements on U.S. Domestic Prices," The Review of Economics and Statistics, MIT Press, vol. 71(3), pages 505-11, August.
- James Brander & Paul Krugman, 1980.
"A "Reciprocal Dumping" Model of International Trade,"
405, Queen's University, Department of Economics.
- Brander, James & Krugman, Paul, 1983. "A 'reciprocal dumping' model of international trade," Journal of International Economics, Elsevier, vol. 15(3-4), pages 313-321, November.
- James A. Brander & Paul Krugman, 1983. "A 'Reciprocal Dumping' Model of International Trade," NBER Working Papers 1194, National Bureau of Economic Research, Inc.
- James Brander & Paul Krugman, 1982. "A 'Reciprocal Dumping' Model of International Trade," Working Papers 513, Queen's University, Department of Economics.
- Pinelopi K. Goldberg & Michael M. Knetter, 1996.
"Goods Prices and Exchange Rates: What Have We Learned?,"
NBER Working Papers
5862, National Bureau of Economic Research, Inc.
- Pinelopi Koujianou Goldberg & Michael M. Knetter, 1997. "Goods Prices and Exchange Rates: What Have We Learned?," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1243-1272, September.
- Özlem Onaran, 2007.
"Wage Share, Globalization, and Crisis: The Case of the Manufacturing Industry in Korea, Mexico, and Turkey,"
wp132, Political Economy Research Institute, University of Massachusetts at Amherst.
- Ozlem Onaran, 2009. "Wage share, globalization and crisis: the case of the manufacturing industry in Korea, Mexico and Turkey," International Review of Applied Economics, Taylor & Francis Journals, vol. 23(2), pages 113-134.
- Rudiger Dornbusch, 1987.
"Exchange Rates and Prices,"
NBER Working Papers
1769, National Bureau of Economic Research, Inc.
- James Heintz, 2006. "Low-wage manufacturing and global commodity chains: a model in the unequal exchange tradition," Cambridge Journal of Economics, Oxford University Press, vol. 30(4), pages 507-520, July.
- Bernard, Andrew B. & Jensen, J. Bradford, 1997.
"Exporters, skill upgrading, and the wage gap,"
Journal of International Economics,
Elsevier, vol. 42(1-2), pages 3-31, February.
- Bernard, A.B. & Jensen, J.B., 1994. "Exporters, Skill Upgrading, and the Wage Gap," Working papers 94-30, Massachusetts Institute of Technology (MIT), Department of Economics.
- Bradford J Jensen & Andrew B Bernard, 1994. "Exporters, Skill Upgrading And The Wage Gap," Working Papers 94-13, Center for Economic Studies, U.S. Census Bureau.
- Ian Steedman, 2005. "The comparative statics of industry-level produced-input-use in HOS trade theory," Review of Political Economy, Taylor & Francis Journals, vol. 17(3), pages 465-470.
- Blecker, Robert A, 1989. "International Competition, Income Distribution and Economic Growth," Cambridge Journal of Economics, Oxford University Press, vol. 13(3), pages 395-412, September.
- Catherine L. Mann, 1986. "Prices, profit margins, and exchange rates," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Jun, pages 366-379.
- Sushanta Mallick & Helena Marques, 2007.
"Pass-through of Exchange Rate and Tariffs into Import Prices of India: Currency Depreciation versus Import Liberalisation,"
3, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
- Sushanta Mallick & Helena Marques, 2008. "Passthrough of Exchange Rate and Tariffs into Import Prices of India: Currency Depreciation versus Import Liberalization," Review of International Economics, Wiley Blackwell, vol. 16(4), pages 765-782, 09.
- David G. Blanchflower & Andrew J. Oswald & Peter Sanfey, 1992.
"Wages, Profits and Rent-Sharing,"
NBER Working Papers
4222, National Bureau of Economic Research, Inc.
- Hartmut Egger & Udo Kreickemeier, 2007.
"Firm Heterogeneity and the Labour Market Effects of Trade Liberalisation,"
CESifo Working Paper Series
2000, CESifo Group Munich.
- Hartmut Egger & Udo Kreickemeier, 2009. "Firm Heterogeneity And The Labor Market Effects Of Trade Liberalization," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 50(1), pages 187-216, 02.
- R. Melvin, James & Warne, Robert D., 1973. "Monopoly and the theory of international trade," Journal of International Economics, Elsevier, vol. 3(2), pages 117-134, May.
- Pastor, Robert, 2011. "The North American Idea: A Vision of a Continental Future," OUP Catalogue, Oxford University Press, number 9780199782413.
- Ronald W. Jones, 1965. "The Structure of Simple General Equilibrium Models," Journal of Political Economy, University of Chicago Press, vol. 73, pages 557.
- Feinberg, Robert M, 1986. "The Interaction of Foreign Exchange and Market Power Effects on German Domestic Prices," Journal of Industrial Economics, Wiley Blackwell, vol. 35(1), pages 61-70, September.
- Ann Harrison & John McLaren & Margaret McMillan, 2011.
"Recent Perspectives on Trade and Inequality,"
Annual Review of Economics,
Annual Reviews, vol. 3(1), pages 261-289, 09.
- Alejandro Castañeda Sabido & David Mulato, 2006. "Market Structure: Concentration and Imports as Determinants of Industry Margins," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 21(2), pages 177-202.
- Berman, Eli & Bound, John & Griliches, Zvi, 1994. "Changes in the Demand for Skilled Labor within U.S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, MIT Press, vol. 109(2), pages 367-97, May.
- Robert C. Feenstra, 1987.
"Symmetric Pass-Through of Tariffs and Exchange Rates Under Imperfect Competition: An Empirical Test,"
NBER Working Papers
2453, National Bureau of Economic Research, Inc.
- Feenstra, Robert C., 1989. "Symmetric pass-through of tariffs and exchange rates under imperfect competition: An empirical test," Journal of International Economics, Elsevier, vol. 27(1-2), pages 25-45, August.
- Nicita, Alessandro, 2009. "The price effect of tariff liberalization: Measuring the impact on household welfare," Journal of Development Economics, Elsevier, vol. 89(1), pages 19-27, May.
- Ethier, Wilfred, 1979. "The theorems of international trade in time-phased economies," Journal of International Economics, Elsevier, vol. 9(2), pages 225-238, May.
- L. Josh Bivens, 2006. "Wages, Profits, and Rent-Sharing in an Open Economy," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(1), pages 69-83.
- Brander, James A. & Spencer, Barbara J., 1984.
"Trade warfare: Tariffs and cartels,"
Journal of International Economics,
Elsevier, vol. 16(3-4), pages 227-242, May.
- Marc J. Melitz, 2003.
"The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity,"
Econometric Society, vol. 71(6), pages 1695-1725, November.
- Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers 3381, C.E.P.R. Discussion Papers.
- Mark J. Melitz, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," NBER Working Papers 8881, National Bureau of Economic Research, Inc.
- Marston, Richard C., 1990. "Pricing to market in Japanese manufacturing," Journal of International Economics, Elsevier, vol. 29(3-4), pages 217-236, November.
- William Milberg & Deborah Winkler, 2010. "Financialisation and the dynamics of offshoring in the USA," Cambridge Journal of Economics, Oxford University Press, vol. 34(2), pages 275-293, March.
- Kenichi Ohno, 1989. "Export Pricing Behavior of Manufacturing: A U.S.: Japan Comparison," IMF Staff Papers, Palgrave Macmillan, vol. 36(3), pages 550-579, September.
- Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, vol. 9(4), pages 469-479, November.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.