Market Imperfections, Wealth Inequality, and the Distribution of Trade Gains
Abstract
We explore the role of the ownership structure of capital in an economy that suffers from barriers to entry and an imperfect financial system. In such an environment, an unequal distribution of capital provides an explanation for trade flows and trade gains even when countries do not differ in relative factor endowments or available technologies. Moreover, an uneven asset distribution is associated with a large import-competing sector and only a small number of export-oriented entrepreneurs. Along these lines, we suggest that an unequal asset distribution may be key to understand why still many less developed countries protect their firms from foreign competition.Download Info
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Paper provided by Institute for Empirical Research in Economics - University of Zurich in its series IEW - Working Papers with number 266.Length:
Date of creation: Jan 2006
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Handle: RePEc:zur:iewwpx:266
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Keywords: inequality; trade policy; economic development;Other versions of this item:
- Foellmi, Reto & Oechslin, Manuel, 2010. "Market imperfections, wealth inequality, and the distribution of trade gains," Journal of International Economics, Elsevier, vol. 81(1), pages 15-25, May.
- Foellmi, Reto & Oechslin, Manuel, 2009. "Market Imperfections, Wealth Inequality, and the Distribution of Trade Gains," CEPR Discussion Papers 7520, C.E.P.R. Discussion Papers.
- Reto Foellmi & Manuel Oechslin, 2010. "Market Imperfections, Wealth Inequality, and the Distribution of Trade Gains," Diskussionsschriften dp1006, Universitaet Bern, Departement Volkswirtschaft.
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-01-24 (All new papers)
- NEP-INT-2006-01-24 (International Trade)
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Spiros Bougheas & Rod Falvey, .
"The Impact of Financial Market Frictions on Trade Flows, Capital Flows and Economic Development,"
Discussion Papers
11/01, University of Nottingham, GEP.
- Spiros Bougheas & Rod Falvey, 2011. "The Impact of Financial Market Frictions on Trade Flows, Capital Flows and Economic Development," CESifo Working Paper Series 3321, CESifo Group Munich.
- Spiros Bougheas & Rod Falvey, . "The Impact of Financial Market Frictions on Trade Flows, Capital Flows and Economic Development," Discussion Papers 11/03, University of Nottingham, Centre for Finance, Credit and Macroeconomics (CFCM).
- Foellmi, Reto & Oechslin, Manuel, 2012. "Globalization and Productivity in the Developing World," Economics Working Paper Series 1203, University of St. Gallen, School of Economics and Political Science.
- Carré, Martine & Riboni, Alessandro, . "Unequal societies, Unequal Terms of Trade and Trade Policy," Open Access publications from Université Paris-Dauphine urn:hdl:123456789/10331, Université Paris-Dauphine.
- Martin Grossmann & Helmut Dietl, 2012. "Asymmetric contests with liquidity constraints," Public Choice, Springer, vol. 150(3), pages 691-713, March.
- Taiji Furusawa & Noriyuki Yanagawa, 2010.
"Firm Heterogeneity under Financial Imperfection: Impacts of Trade and Capital Movement,"
CARF F-Series
CARF-F-233, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
- Taiji Furusawa & Noriyuki Yanagawa, 2010. "Firm Heterogeneity under Financial Imperfection: Impacts of Trade and Capital Movement," CIRJE F-Series CIRJE-F-768, CIRJE, Faculty of Economics, University of Tokyo.
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