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Demand patterns and vertical intra-industry trade with special reference to North-South trade

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  • Joakim Gullstrand

Abstract

Demand patterns have been considered important driving forces of intra-industry trade (IIT) ever since the emergence of IIT literature. The distribution of income within countries and per capita income differences between countries are regarded as major explanatory factors behind vertical IIT. This paper focuses on North-South trade, and we are particularly interested in the role of income distribution and per capita income as demand-side determinants of vertical IIT. We test hypotheses on differences in income distribution, differences in per capita income, and average market size in two different empirical approaches; an economy-wide, and a multi-industry approach. The results show evidence of the role of income distribution and per capita income, that there is an important interaction between these two variables, and that the average market size matters.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal The Journal of International Trade & Economic Development.

Volume (Year): 11 (2001)
Issue (Month): 4 ()
Pages: 429-455

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Handle: RePEc:taf:jitecd:v:11:y:2001:i:4:p:429-455

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Web page: http://www.tandfonline.com/RJTE20

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Related research

Keywords: Vertical Intra-INDUSTRY Trade; North-SOUTH Trade; European Union;

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Cited by:
  1. Imre Ferto & Károly Attila Soós, 2012. "Controversial issues in factors determining intra-industry trade," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 4(1/2), pages 132-148.
  2. Božić, Dragica & Nikolić, Marija M., 2013. "Regional Analysis of Agricultural and Food Trade of Serbia," 135th Seminar, August 28-30, 2013, Belgrade, Serbia 160374, European Association of Agricultural Economists.
  3. Valerija Botrić, 2013. "Determinants of Intra-industry Trade between Western Balkans and EU-15: Evidence from Bilateral Data," International Journal of Economic Sciences and Applied Research (IJESAR), Technological Educational Institute (TEI) of Kavala, Greece, vol. 6(2), pages 7-23, September.
  4. Lars Jensen & Teit Lüthje, 2009. "Driving forces of vertical intra-industry trade in Europe 1996–2005," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 145(3), pages 469-488, October.

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