Cross-Sector Spillover Effects of Trade Liberalization
This work studies the effects of trade liberalization in a two-country two-sector model, with monopolistic competition and heterogeneous firms in one sector and perfect competition in the other. It is established that the spillover effect of the reduction in a sector's variable trade cost on the average productivity of firms in the other sector is sector dependent. The average productivity of firms increases and the number of firms decreases in the comparative advantage sector in response to the trade liberalization in the other sector. Conversely, the average productivity of firms decreases and the number of firms increases in the comparative disadvantage sector.
Volume (Year): 39 (2013)
Issue (Month): 1 ()
|Contact details of provider:|| Web page: http://www.palgrave-journals.com/|
Postal:c/o Dr. Alexandre Olbrecht, The Anisfield School of Business 205, Ramapo College, 505 Ramapo Valley Road, Ramapo, New Jersey 07430, USA
Phone: (201) 684-7346
Web page: https://www.qu.edu/eea/
More information through EDIRC
|Order Information:||Web: http://www.springer.com/economics/journal/41302|
When requesting a correction, please mention this item's handle: RePEc:pal:easeco:v:39:y:2013:i:1:p:1-17. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.