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Geographical Disadvantage: A Heckscher-Ohlin-Von Thunen model of International Specialization

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Author Info
Limão, Nuno
Venables, Anthony J.

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Abstract

We analyze the trade and production patterns of countries located at varying distances from an economic centre. Exports and imports of final and intermediate goods bear transport costs that increase with distance. We show how production and trade depend both on factor endowments and factor intensities, and on distance and the transport intensities of different goods. Countries divide into zones with different trade patterns, some export oriented and others import substituting. We study the implications of distance for factor prices and real incomes, the effects of changes in transport costs, and the locational choice of new activities.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2305.

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Date of creation: Dec 1999
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Handle: RePEc:cpr:ceprdp:2305

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Related research
Keywords: Specialization; Trade; Transport Costs;

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Find related papers by JEL classification:
F10 - International Economics - - Trade - - - General

References listed on IDEAS
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  1. Samuelson, Paul A, 1983. "Thunen at Two Hundred," Journal of Economic Literature, American Economic Association, vol. 21(4), pages 1468-88, December. [Downloadable!] (restricted)
  2. Leamer, Edward E. & Levinsohn, James, 1995. "International trade theory: The evidence," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 26, pages 1339-1394 Elsevier. [Downloadable!] (restricted)
    Other versions:
  3. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476, January.
  4. Limao, Nuno & Venables, Anthony J., 1999. "Infrastructure, geographical disadvantage, and transport costs," Policy Research Working Paper Series 2257, The World Bank. [Downloadable!]
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Cited by:
(explanations, 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.)

  1. Nuno Limão & Arvind Panagariya, 2003. "Why is there an Anti-trade Bias in Trade Policy?," International Trade 0310003, EconWPA. [Downloadable!]
  2. Henderson, J. Vernon & Shalizi, Zmarak & Venables, Anthony J., 2000. "Geography and development," Policy Research Working Paper Series 2456, The World Bank. [Downloadable!]
    Other versions:
  3. Christiane Krieger-Boden, 2000. "Globalization, Integration and Regional Specialization," Kiel Working Papers 1009, Kiel Institute for the World Economy. [Downloadable!]
  4. J. Ernesto López-Córdova & Christopher M. Meissner, 2003. "Exchange-Rate Regimes and International Trade: Evidence from the Classical Gold Standard Era," American Economic Review, American Economic Association, vol. 93(1), pages 344-353, March. [Downloadable!]
    Other versions:
  5. James Harrigan, 2005. "Airplanes and Comparative Advantage," NBER Working Papers 11688, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  6. Fafchamps, Marcel & Shilpi, Forhad, 2002. "The spatial division of labor in Nepal," Policy Research Working Paper Series 2845, The World Bank. [Downloadable!]
    Other versions:
  7. Stephen Redding & Peter K. Schott, 2003. "Distance, Skill Deepening and Development: Will Peripheral Countries Ever Get Rich?," NBER Working Papers 9447, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  8. Xubei Luo, 2004. "The role of infrastructure investment location in China's western development," Policy Research Working Paper Series 3345, The World Bank. [Downloadable!]
  9. Fafchamps, Marcel & Shilpi, Forhad, 2006. "Isolation and Subjective Welfare," CEPR Discussion Papers 6001, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  10. Edgar Morgenroth, 2003. "What should Policy Makers Learn from Recent Advances in Growth Theory and New Economic Geography?," Papers WP150, Economic and Social Research Institute (ESRI). [Downloadable!]
  11. Fink, Carsten & Mattoo, Aaditya & Neagu, Ileana Cristina, 2001. "Trade in international maritime services : how much does policy matter?," Policy Research Working Paper Series 2522, The World Bank. [Downloadable!]
    Other versions:
  12. Elisa Álvarez López & Rafael Myro Sánchez, 2005. "Specialization and openness to foreign trade in the European Union," Applied Economics Letters, Taylor and Francis Journals, vol. 12(13), pages 805-810, October. [Downloadable!] (restricted)
  13. Rünno Lumiste, 2006. "Migration of Electronics Production. Optimisation of Technology or Labour Costs?," Working Papers 148, School of Economics and Business Administration, Tallinn University of Technology. [Downloadable!]
  14. Henk J.E.M. Brand, 2004. "The Economic Geography Effects of Trade Liberalisation on the National Regions of Spain," Working Papers 2004_8, Department of Economics, University of Glasgow. [Downloadable!]
  15. Takanori Ago & Ikumo Isono & Takatoshi Tabuchi, 2003. "Locational Disadvantage and Losses from Trade: Three Regions in Economic Geography," CIRJE F-Series CIRJE-F-224, CIRJE, Faculty of Economics, University of Tokyo. [Downloadable!]
  16. Shatz, Howard J. & Venables, Anthony J., 2000. "The geography of international investment," Policy Research Working Paper Series 2338, The World Bank. [Downloadable!]
  17. Stephen Redding & Anthony J. Venables, 2002. "The Economics of Isolation and Distance," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 28, pages 93-108. [Downloadable!]
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