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A Simple Model of Service Trade with Time Zone Differences

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  • Kikuchi, Toru
  • Iwasa, Kazumichi

Abstract

This note proposes a two-country monopolistic competition model of service trade that captures the role of time zone differences as a determinant of trade patterns. It is shown that the utilization of time zone differences induces drastic change in trade patterns: Due to taking advantage of time zone differences, service firms learve larger countries for smaller countries.

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File URL: http://mpra.ub.uni-muenchen.de/9574/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 9574.

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Date of creation: 2008
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Handle: RePEc:pra:mprapa:9574

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  1. Elhanan Helpman, 2006. "Trade, FDI, and the Organization of Firms," Journal of Economic Literature, American Economic Association, American Economic Association, vol. 44(3), pages 589-630, September.
  2. Jones, Ronald & Kierzkowski, Henryk & Lurong, Chen, 2005. "What does evidence tell us about fragmentation and outsourcing?," International Review of Economics & Finance, Elsevier, Elsevier, vol. 14(3), pages 305-316.
  3. Dixit, Avinash K & Stiglitz, Joseph E, 1975. "Monopolistic Competition and Optimum Product Diversity," The Warwick Economics Research Paper Series (TWERPS), University of Warwick, Department of Economics 64, University of Warwick, Department of Economics.
  4. repec:ebl:ecbull:v:6:y:2006:i:15:p:1-10 is not listed on IDEAS
  5. Marjit, Sugata, 2007. "Trade theory and the role of time zones," International Review of Economics & Finance, Elsevier, Elsevier, vol. 16(2), pages 153-160.
  6. Toru Kikuchi, 2006. "Time Zones, Outsourcing and Patterns of International Trade," Economics Bulletin, AccessEcon, vol. 6(15), pages 1-10.
  7. Toru Kikuchi, 2005. "Interconnected communications networks and home market effects," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 38(3), pages 870-882, August.
  8. Caroline Freund & Diana Weinhold, 2002. "The Internet and International Trade in Services," American Economic Review, American Economic Association, American Economic Association, vol. 92(2), pages 236-240, May.
  9. Carolyn L. Evans & James Harrigan, 2005. "Distance, Time, and Specialization: Lean Retailing in General Equilibrium," American Economic Review, American Economic Association, American Economic Association, vol. 95(1), pages 292-313, March.
  10. Krugman, Paul, 1980. "Scale Economies, Product Differentiation, and the Pattern of Trade," American Economic Review, American Economic Association, American Economic Association, vol. 70(5), pages 950-59, December.
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Cited by:
  1. Toru Kikuchi & Ngo Van Long, 2010. "A Simple Model of Service Offshoring with Time Zone Differences," CESifo Working Paper Series 2990, CESifo Group Munich.
  2. Matsuoka, Yuji & Fukushima, Marcelo, 2010. "Time zones, shift working and international outsourcing," International Review of Economics & Finance, Elsevier, Elsevier, vol. 19(4), pages 769-778, October.
  3. João Amador & Sónia Cabral, 2014. "Global Value Chains: Surveying Drivers, Measures and Impacts," Working Papers, Banco de Portugal, Economics and Research Department w201403, Banco de Portugal, Economics and Research Department.
  4. Mukherjee, Arijit & Suetrong, Kullapat, 2012. "Trade cost reduction and foreign direct investment," Economic Modelling, Elsevier, Elsevier, vol. 29(5), pages 1938-1945.

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