Explaining Trade Flows: Traditional and New Determinants of Trade Patterns
AbstractAn empirical tradition in international trade seeks to establish whether the predictions of factor abundance theory match with the data. In this paper, we test if the “new” determinants used in the factor content version of H-O-V models (differences in productivity, in returns to scale or in consumers’ preferences) help us to improve our estimation of trade patterns in commodities. The results show that conventional factors are still important in determining trade structure although new determinants need to be included to determine comparative advantage. Turning to the change across periods, differences in factor endowments have not diminished over time: we observe an increase in specialization according to skill endowment. Hence, those “new” determinants are not new forces that drive trade flows.
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Bibliographic InfoArticle provided by Center for Economic Integration, Sejong University in its journal Journal of Economic Integration.
Volume (Year): 24 (2009)
Issue (Month): ()
international trade; Hecksher-Ohlin model;
Other versions of this item:
- Julien GOURDON, 2007. "Explaining Trade Flows: Traditional and New Determinants of Trade Patterns," Working Papers 200706, CERDI.
- Gourdon, Julien, 2006. "Explaining Trade Flows: Traditional and New Determinants of Trade Patterns," MPRA Paper 4175, University Library of Munich, Germany.
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- F20 - International Economics - - International Factor Movements and International Business - - - General
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- Julie Regolo, 2013. "Export Diversification: How Much Does the Choice of the Trading Partner Matter?," Research Papers by the Institute of Economics and Econometrics, Geneva School of Economics and Management, University of Geneva 13072, Institut d'Economie et Econométrie, Université de Genève.
- Jan Hanousek & Evžen Kočenda, 2013. "Factors of trade in Europe," Working Papers 333, Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies).
- Regolo, Julie, 2013. "Export diversification: How much does the choice of the trading partner matter?," Journal of International Economics, Elsevier, vol. 91(2), pages 329-342.
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