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Trade and the Industrial Specialization of Canadian Manufacturing Regions, 1974 to 1999

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  • W. Mark Brown

    (Statistics Canada, Ottawa, mark.brown@statcan.ca)

Abstract

Using a longitudinal micro data file of manufacturing plants (1974 to 1999), this study tests the relationship between trade and industrial specialization experienced by regional manufacturing economies. Consistent with trade driven by comparative advantage, the analysis demonstrates that export intensity (exports as a share of output) is positively associated with industrial specialization. This association is strongest in cross-section but remains, albeit weaker, when the data are differenced throughout time. The association between trade and specialization is strongest outside of urban areas and Ontario and Quebec, regions where trade is most likely driven by access to resource endowments. The association between trade and specialization weakens significantly after 1990, a period that corresponds with the rapid integration of the Canadian economy into the U.S. market resulting from trade liberalization.

Suggested Citation

  • W. Mark Brown, 2008. "Trade and the Industrial Specialization of Canadian Manufacturing Regions, 1974 to 1999," International Regional Science Review, , vol. 31(2), pages 138-158, April.
    • Handle: RePEc:sae:inrsre:v:31:y:2008:i:2:p:138-158
    DOI: 10.1177/0160017607309447
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    References listed on IDEAS

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    1. Davis, Donald R., 1995. "Intra-industry trade: A Heckscher-Ohlin-Ricardo approach," Journal of International Economics, Elsevier, vol. 39(3-4), pages 201-226, November.
    2. Baldwin, John R. & Raffiquzzaman, Mohammed, 1995. "Restructuring in the Canadian Manufacturing Sector from 1970 to 1990: Industry and Regional Dimensions of Job Turnover," Analytical Studies Branch Research Paper Series 1995078e, Statistics Canada, Analytical Studies Branch.
    3. John Baldwin & Wulong Gu, 2009. "The Impact of Trade on Plant Scale, Production-Run Length and Diversification," NBER Chapters, in: Producer Dynamics: New Evidence from Micro Data, pages 557-592, National Bureau of Economic Research, Inc.
    4. Krugman, Paul, 1980. "Scale Economies, Product Differentiation, and the Pattern of Trade," American Economic Review, American Economic Association, vol. 70(5), pages 950-959, December.
    5. Brown, W. Mark & Vinodrai, Tara & Baldwin, John R., 2001. "Dynamics of the Canadian Manufacturing Sector in Metropolitan and Rural Regions," Analytical Studies Branch Research Paper Series 2001169e, Statistics Canada, Analytical Studies Branch.
    6. Marius Brulhart & Michael Thorpe, 2001. "Export growth of NAFTA members, intra-industry trade and adjustment," Global Business and Economics Review, Inderscience Enterprises Ltd, vol. 3(1), pages 94-110.
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    Cited by:

    1. Sébastien Breau & David L. Rigby, 2010. "International trade and wage inequality in Canada," Journal of Economic Geography, Oxford University Press, vol. 10(1), pages 55-86, January.

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