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Input substitutability, trade costs and location

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  • Michalski, Tomasz

Abstract

Constant unit manufacturing costs are lower (higher) in high wage North when inputs are (i) tradeable, (ii) country-specific and (iii) the elasticity of substitution between them is below (above) one. A two-country model of firm entry/location is considered.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 117 (2012)
Issue (Month): 1 ()
Pages: 57-59

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Handle: RePEc:eee:ecolet:v:117:y:2012:i:1:p:57-59

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Web page: http://www.elsevier.com/locate/ecolet

Related research

Keywords: Input substitutability; Trade costs; North–South trade; Location;

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References

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  1. Robert L. Basmann & Michael McAleer & Daniel Slottje, 2003. "Patent Activity and Technical Change," CIRJE F-Series CIRJE-F-217, CIRJE, Faculty of Economics, University of Tokyo.
  2. Achilladelis, Basil & Antonakis, Nicholas, 2001. "The dynamics of technological innovation: the case of the pharmaceutical industry," Research Policy, Elsevier, vol. 30(4), pages 535-588, April.
  3. Pol Antras, 2004. "Incomplete Contracts and the Product Cycle," 2004 Meeting Papers 19, Society for Economic Dynamics.
  4. Daron Acemoglu & Gino Gancia & Fabrizio Zilibotti, 2010. "Competing engines of growth: Innovation and standardization," Economics Working Papers 1358, Department of Economics and Business, Universitat Pompeu Fabra, revised Aug 2010.
  5. Alan V Deardorff, 2004. "Local Comparative Advantage: Trade Costs and the Pattern of Trade," Working Papers 500, Research Seminar in International Economics, University of Michigan.
  6. Gene M. Grossman & Esteban Rossi-Hansberg, 2006. "Trading Tasks: A Simple Theory of Offshoring," NBER Working Papers 12721, National Bureau of Economic Research, Inc.
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