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Competing Communications Networks and International Trade

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  • Fukushima, Marcelo
  • Kikuchi, Toru

Abstract

This paper investigates the effects of competing communication networks on trade patterns in a Chamberlinian-Ricardian model of monopolistically competitive firms with a continuum of industries that require communication services in production. We conclude that intraindustry trade between different networks is determined by the relative size of networks and technological differences, and that a network will not have an incentive to expand indefi- nitely, despite network externalities.

Suggested Citation

  • Fukushima, Marcelo & Kikuchi, Toru, 2008. "Competing Communications Networks and International Trade," MPRA Paper 7815, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:7815
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    References listed on IDEAS

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    1. Richard G. Harris, 1995. "Trade and Communication Costs," Canadian Journal of Economics, Canadian Economics Association, vol. 28(s1), pages 46-75, November.
    2. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    3. Anthony J. Venables, 1999. "The International Division of Industries: Clustering and Comparative Advantage in a Multi‐industry Model," Scandinavian Journal of Economics, Wiley Blackwell, vol. 101(4), pages 495-513, December.
    4. Toru Kikuchi & Koji Shimomura & Dao-Zhi Zeng, 2006. "On the Emergence of Intra-industry Trade," Journal of Economics, Springer, vol. 87(1), pages 15-28, January.
    5. Dornbusch, Rudiger & Fischer, Stanley & Samuelson, Paul A, 1977. "Comparative Advantage, Trade, and Payments in a Ricardian Model with a Continuum of Goods," American Economic Review, American Economic Association, vol. 67(5), pages 823-839, December.
    6. Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, vol. 9(4), pages 469-479, November.
    7. Kikuchi, Toru, 2005. "On the enlargement of interconnected communications networks in the world economy," The Quarterly Review of Economics and Finance, Elsevier, vol. 45(1), pages 18-27, February.
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    Cited by:

    1. Zon, Adriaan van & Mupela, Evans, 2010. "Endogenous Economic Growth through Connectivity," MERIT Working Papers 2010-001, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

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    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

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