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Comparative Advantages, Transaction Costs and Factor Content in Agricultural Trade: Empirical Evidence from the CEE - Vantaggi comparati, costi di transazione e contenuto dei fattori nel commercio agricolo: evidenze empiriche dai paesi dell’Europa centro-orientale

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  • Ciaian, Pavel

    () (European Commission (DG Joint Research Centre IPTS), Economics and Econometrics Research Institute (EERI), and Catholic University of Leuven (LICOS))

  • Kancs, d'Artis

    () (European Commission (DG Joint Research Centre IPTS), Catholic University of Leuven (LICOS), and Economics and Econometrics Research Institute (EERI))

  • Pokrivcak, Jan

    () (Slovenská Polnohospodárska Univerzita (SAU), and Economics and Econometrics Research Institute (EERI))

Abstract

The paper studies the determinants of the factor content in the EU foreign trade. The theoretical model relaxes several important assumptions such as factor price equalisation and introduces technological differences in the standard Heckscher-Ohlin model. Based on the agricultural production and trade data for the Central and East European (CEE) EU member states, we examine empirically three hypothesis, which relate cross-country differences in technology, relative factor abundance and transaction costs and market imperfections to the factor content of trade, we find that the first two hypotheses are confirmed by the majority of the developed EU countries, but rejected by roughly one half of the CEE transition country pairs. Second, we find that when accounting for transaction costs of farm (re)organisation, both hypotheses are confirmed by the majority of the CEE country pairs. These findings provide empirical evidence of market imperfections, and particularly, of transaction costs of farm (re)organisation in the CEE.- Questo lavoro esamina le determinanti del contenuto dei fattori nel commercio estero dell’Unione Europea. Il modello teorico tralascia postulati importanti come l’equalizzazione del fattore prezzo e introduce differenze tecnologiche nel modello standard Heckscher-Ohlin. Basandosi sui dati della produzione agricola e del commercio dei paesi comunitari dell’Europa centroorientale, lo studio esamina empiricamente tre ipotesi che mettono in relazione le differenze cross-country nella tecnologia, l’abbondanza relativa dei fattori, i costi di transazione e le imperfezioni del mercato con il contenuto dei fattori del commercio. Si riscontra che le prime due ipotesi sono confermate per la maggioranza dei paesi UE sviluppati, mentre per circa la metà dei paesi comunitari in transizione dell’Europa centro-orientale devono essere rifiutate. Inoltre, spiegando i costi di transazione della riorganizzazione agricola, si riscontra che entrambe le ipotesi sono confermate per la maggioranza delle coppie di paesi comunitari dell’Europa centro-orientale. Questi riscontri forniscono evidenze empiriche di imperfezioni del mercato e, in particolare, dei costi di transazione della (ri)organizzazione agricola nell’Europa comunitaria centro-orientale.

Suggested Citation

  • Ciaian, Pavel & Kancs, d'Artis & Pokrivcak, Jan, 2011. "Comparative Advantages, Transaction Costs and Factor Content in Agricultural Trade: Empirical Evidence from the CEE - Vantaggi comparati, costi di transazione e contenuto dei fattori nel commercio agr," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 64(1), pages 67-101.
  • Handle: RePEc:ris:ecoint:0609
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    Cited by:

    1. Ciaian, Pavel & Kancs, d'Artis & Pokrivcak, Jan, 2011. "Comparative Advantages, Transaction Costs and Factor Content in Agricultural Trade: Empirical Evidence from the CEE - Vantaggi comparati, costi di transazione e contenuto dei fattori nel commercio agr," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 64(1), pages 67-101.
    2. d'Artis Kancs & Pavel Ciaian, 2010. "Factor content of bilateral trade: the role of firm heterogeneity and transaction costs," Agricultural Economics, International Association of Agricultural Economists, vol. 41(3-4), pages 305-317, May.
    3. d’Artis Kancs & Pavel Ciaian, 2012. "The Factor Content of Heterogeneous Firm Trade," The World Economy, Wiley Blackwell, vol. 35(3), pages 373-393, March.
    4. Anna Bandlerová & Jarmila Lazíková, 2016. "Land lease contract and prior right of lessee to concluding the new land lease contract - case of Slovakia," Juridical Tribune (Tribuna Juridica), Bucharest Academy of Economic Studies, Law Department, vol. 6(2), pages 304-320, December.

    More about this item

    Keywords

    Factor Content; Bilateral Trade; Relative Factor Abundance; Technological Differences; Agriculture; Transaction Costs;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

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