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Protection, international factor mobility and monopolistic competition

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Author Info
Sajid Anwar (School of Business, Northern Territory University, Australia)

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Abstract

This paper utilises a model of a small open economy that produces two traded goods by means of primary factors and a large number of varieties of a non-traded intermediate good. Unlike the traded goods, the production of each variety of the non-traded good is subject to internal economies of scale and monopolistic competition prevails in the intermediate good sector. The presence of internal economies in the intermediate good sector gives rise to external economies in the production of the final good sector. Within the context of the present study, interindustry and intra-industry trade takes place side by side. The model is used to examine the impact of tariffs and changes in factor endowments on allocation of resources and welfare.

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File URL: http://www.taloustieteellinenyhdistys.fi/images/stories/fep/f2000_2c.pdf
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Publisher Info
Article provided by Finnish Economic Association in its journal Finnish Economic Papers.

Volume (Year): 13 (2000)
Issue (Month): 2 (Autumn)
Pages: 116-128
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Handle: RePEc:fep:journl:v:13:y:2000:i:2:p:116-128

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Web page: http://www.taloustieteellinenyhdistys.fi
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Find related papers by JEL classification:
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
F20 - International Economics - - International Factor Movements and International Business - - - General
F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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  1. Rivera-Batiz, Francisco L. & Rivera-Batiz, Luis A., 1990. "The effects of direct foreign investment in the presence of increasing returns due to specialization," Journal of Development Economics, Elsevier, vol. 34(1-2), pages 287-307, November. [Downloadable!] (restricted)
  2. Markusen, James R. & Venables, Anthony J., 1999. "Foreign direct investment as a catalyst for industrial development," European Economic Review, Elsevier, vol. 43(2), pages 335-356, February. [Downloadable!] (restricted)
    Other versions:
  3. Panagariya, Arvind, 1986. "Increasing returns, dynamic stability, and international trade," Journal of International Economics, Elsevier, vol. 20(1-2), pages 43-63, February. [Downloadable!] (restricted)
  4. Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June. [Downloadable!] (restricted)
  5. Ottaviano, Gianmarco Ireo Paolo & Puga, Diego, 1997. "Agglomeration in the Global Economy: A Survey of the 'New Economic Geography'," CEPR Discussion Papers 1699, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  6. Markusen, James R, 1989. "Trade in Producer Services and in Other Specialized Intermediate Inputs," American Economic Review, American Economic Association, vol. 79(1), pages 85-95, March. [Downloadable!] (restricted)
  7. Helpman, Elhanan, 1984. "Increasing returns, imperfect markets, and trade theory," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 7, pages 325-365 Elsevier. [Downloadable!] (restricted)
  8. Venables, Anthony J., 1985. "Trade and trade policy with imperfect competition: The case of identical products and free entry," Journal of International Economics, Elsevier, vol. 19(1-2), pages 1-19, August. [Downloadable!] (restricted)
  9. Joseph F. Francois, 1990. "Trade in Producer Services and Returns Due to Specialization under Monopolistic Competition," Canadian Journal of Economics, Canadian Economics Association, vol. 23(1), pages 109-24, February. [Downloadable!] (restricted)
  10. Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, vol. 9(4), pages 469-479, November. [Downloadable!] (restricted)
  11. Rodriguez-Clare, Andres, 1996. "The division of labor and economic development," Journal of Development Economics, Elsevier, vol. 49(1), pages 3-32, April. [Downloadable!] (restricted)
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