Search and the Path-Dependency of Trade

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Search and the Path-Dependency of Trade

Author Info

T. Huw Edwards () (Loughborough University)

Additional information is available for the following registered author(s):

Terence Huw Edwards

Abstract

This paper investigates the implications of imperfect information and matching/searching for international trade theory. I develop an illustrative model where firms find such partners by a search through successive matches. The consequences include linking today's import demand patterns to past changes in costs, protection and interest rates. Today's policy decisions will likewise affect future trade. Trade diversion from a preferential trading agreement may well persist as informational diversion well after the preferential agreement has been scrapped. This has important implications for the timing of trade liberalisation.

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Publisher Info
Paper provided by Department of Economics, Loughborough University in its series Discussion Paper Series with number 2006_12.

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Date of creation: May 2006
Date of revision: May 2006
Handle: RePEc:lbo:lbowps:2006_12

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Postal: Loughborough, Leicestershire, LE11 3TU
Phone: +44 (0) 1509 222701
Fax: +44 (0) 1509 223910
Web page: http://www.lboro.ac.uk/departments/ec/Research.htm
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Find related papers by JEL classification:
F00 - International Economics - - General - - - General
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

This paper has been announced in the following NEP Reports:

NEP-ALL-2006-06-10 (All new papers)
NEP-INT-2006-06-10 (International Trade)

References listed on IDEAS
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