Intra-Industry Trade and Revealed Comparative Advantage: An Inverted-U Relationship

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Intra-Industry Trade and Revealed Comparative Advantage: An Inverted-U Relationship

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Horácio Faustino

Abstract

This paper investigates the relationship between all types of intra-industry trade (IIT) and comparative advantage. The paper finds strong evidence of an inverted-U relationship.The results also suggest that relative autarky costs is a common determinant for any type of IIT, which contradicts the prediction made by theory for separating the determinants of horizontal and vertical IIT.

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Paper provided by Department of Economics at the School of Economics and Management (ISEG), Technical University of Lisbon. in its series Working Papers with number 2008/03.

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Date of creation: Jan 2008
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Handle: RePEc:ise:isegwp:wp32008

Contact details of provider:
Postal: Department of Economics, School of Economics and Management (ISEG), Technical University of Lisbon, Rua do Quelhas 6, 1200-781 LISBON, PORTUGAL
Web page: http://www.iseg.utl.pt/departamentos/economia/

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Find related papers by JEL classification:
F1 - International Economics - - Trade
C0 - Mathematical and Quantitative Methods - - General
C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables

This paper has been announced in the following NEP Reports:

NEP-ALL-2008-01-26 (All new papers)
NEP-CSE-2008-01-26 (Economics of Strategic Management)
NEP-INT-2008-01-26 (International Trade)

References listed on IDEAS
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.:

David Greenaway & Robert Hine & Chris Milner & Robert Elliott, 1994. "Adjustment and the measurement of marginal intra-industry trade," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 130(2), pages 418-427, June. [Downloadable!] (restricted)
Lancaster, Kelvin, 1980. "Intra-industry trade under perfect monopolistic competition," Journal of International Economics, Elsevier, vol. 10(2), pages 151-175, May. [Downloadable!] (restricted)
P. Tharakan & Birgit Kerstens, 1995. "Does North-South horizontal intra-industry trade really exist? An analysis of the toy industry," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 131(1), pages 86-105, March. [Downloadable!] (restricted)
David Greenaway & Robert Hine & Chris Milner, 1994. "Country-specific factors and the pattern of horizontal and vertical intra-industry trade in the UK," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 130(1), pages 77-100, March. [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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This page was last updated on 2009-12-16.

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