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Trade Liberalisation, Health Care and International Fragmentation: The Role of Health Capital Mobility


  • Tonmoy Chatterjee

    (Department of Economics, Rabindra Bharati University, Kolkata, India)

  • Kausik Gupta

    (Department of Economics, Rabindra Bharati University, Kolkata, India.)


This paper delves into the complex relationship between health trade through international fragmentation and health trade through commercial presence. A neo-classical full employment four sector static general equilibrium model has been developed, where the three sectors produce final products except the health intermediate goods producing sector. The paper shows that expansion of health trade through commercial presence implies, under some reasonable conditions, enhancement of the volume of health trade through international fragmentation. It also shows that the composite volume of trade in health services through international fragmentation and commercial presence increases the size of the health care in our stylised small open economy.

Suggested Citation

  • Tonmoy Chatterjee & Kausik Gupta, 2014. "Trade Liberalisation, Health Care and International Fragmentation: The Role of Health Capital Mobility," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 53(1), pages 57-65.
  • Handle: RePEc:pid:journl:v:53:y:2014:i:1:p:57-65

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    References listed on IDEAS

    1. Jones, Ronald W. & Kierzkowski, Henryk, 2005. "International fragmentation and the new economic geography," The North American Journal of Economics and Finance, Elsevier, vol. 16(1), pages 1-10, March.
    2. Marjit, Sugata & Mandal, Biswajit, 2009. "General Trading Costs in Pure Theory of International Trade," MPRA Paper 19290, University Library of Munich, Germany.
    3. Deardorff, Alan V., 2001. "Fragmentation in simple trade models," The North American Journal of Economics and Finance, Elsevier, vol. 12(2), pages 121-137, July.
    4. Sugata Marjit & Hamid Beladi & Avik Chakrabarti, 2004. "Trade and Wage Inequality in Developing Countries," Economic Inquiry, Western Economic Association International, vol. 42(2), pages 295-303, April.
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    More about this item


    Health Sector; Health Intermediate Sector; International Fragmentation and International Health Capital Mobility;

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models


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