International Material-Product Chains: An Alternative Perspective on International Trade and Trade Theories
AbstractThe relationship between trade and material flows is examined by viewing the global economy from the perspective of international material-product chains (MPC). The international MPC covers the complete lifecycle of a material or a product in two or more regions, including extraction, production, consumption, waste management and transport. Products, waste, and associated material flows in the international MPC can run vertically or horizontally between segments. It is demonstrated how differences in factor requirements across segments of the international MPC in combination with factor productivity differences across developed and developing countries can cause specific trade patterns of inter-industry and intra-industry flows of materials and products. The implications of considering various trade theories in the context of the idea of an international MPC are examined. This interpretation of international trade sheds a new light especially on the physical dimension of international specialisation.
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Date of creation: 18 Apr 2000
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