A Country's Maximal Gains from Trade and Conflicting National Interests

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A Country's Maximal Gains from Trade and Conflicting National Interests

Author Info

Baumol, W.J.
Gomory, R.E.

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William Baumol

Abstract

This paper shows that there are gains from trade that a country can capture from a partly developed trading partner that strongly exceed the gains it can obtain by trading with a fully developed one. We will also show that these gains are beneficial to one country only, they always come at the expense of the trading partner. We will also discuss more generally the circumstances under which improvements in productivity in a trading partner are beneficial to the home country.

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Paper provided by C.V. Starr Center for Applied Economics, New York University in its series Working Papers with number 98-22.

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Length: 45 pages
Date of creation: 1998
Date of revision:
Handle: RePEc:cvs:starer:98-22

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Related research
Keywords: TRADE ; MODELS ; ECONOMIC EQUILIBRIUM;

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Find related papers by JEL classification:
F11 - International Economics - - Trade - - - Neoclassical Models of Trade

References listed on IDEAS
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Gene M. Grossman & Elhanan Helpman, 1994. "Technology and Trade," NBER Working Papers 4926, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
Other versions:
- Grossman, Gene & Helpman, Elhanan, 1995. "Technology and Trade," CEPR Discussion Papers 1134, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
- Grossman, G.M. & Helpman, E., 1994. "Technology and Trade," Papers 175, Princeton, Woodrow Wilson School - Public and International Affairs.
- Grossman, Gene M. & Helpman, Elhanan, 1995. "Technology and trade," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 25, pages 1279-1337 Elsevier. [Downloadable!] (restricted)
Ethier, Wilfred, 1979. "Internationally decreasing costs and world trade," Journal of International Economics, Elsevier, vol. 9(1), pages 1-24, February. [Downloadable!] (restricted)
Gomory, Ralph E., 1994. "Shares of World Output, Economies of Scale, and Regions Filled with Equilibria," Working Papers 94-29, C.V. Starr Center for Applied Economics, New York University. [Downloadable!]
Johnson, G.E. & Stafford, F.P., 1993. "International Competition and Real Wages," Working Papers 323, Research Seminar in International Economics, University of Michigan.
Johnson, George E & Stafford, Frank P, 1993. "International Competition and Real Wages," American Economic Review, American Economic Association, vol. 83(2), pages 127-30, May. [Downloadable!] (restricted)
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)

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