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Gains from domestic versus international trade: Evidence from the US

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  • Hakan Yilmazkuday

Abstract

Using varieties of a rich model that considers sectoral heterogeneity and input-output linkages, this paper shows that the overall welfare gains of a region within a country can be decomposed into domestic versus international welfare gains from trade. Empirical results based on sector- and state-level data from the US suggest that about 94 percent of the overall welfare gains of a state is due to domestic trade with other states. The ocean states gain from international trade about two times the Great Lake states and about three times the landlocked states.

Suggested Citation

  • Hakan Yilmazkuday, 2020. "Gains from domestic versus international trade: Evidence from the US," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 29(2), pages 199-210, February.
    • Handle: RePEc:taf:jitecd:v:29:y:2020:i:2:p:199-210
    DOI: 10.1080/09638199.2019.1662075
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    Cited by:

    1. Carlos Llano-Verduras & Santiago Pérez-Balsalobre & Ana Rincón-Aznar, 2021. "Market fragmentation and the rise of sub-national regulation," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 67(3), pages 765-797, December.
    2. Yilmazkuday, Hakan, 2012. "Understanding interstate trade patterns," Journal of International Economics, Elsevier, vol. 86(1), pages 158-166.
    3. Jianyue Ji & Qining Shan & Xingmin Yin, 2024. "How does inter-provincial trade promote economic growth? Empirical evidence from Chinese provinces," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 11(1), pages 1-15, December.
    4. Yilmazkuday, Hakan, 2024. "Diminishing gains from trade across countries: Interaction between trade elasticity and openness," Journal of International Money and Finance, Elsevier, vol. 141(C).
    5. Jason Query, 2020. "Differing trade elasticities for intra‐ and international distances: A gravity approach," Review of International Economics, Wiley Blackwell, vol. 28(3), pages 913-929, August.

    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies

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