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When autarky trumps free and costless trade

Author

Listed:
  • Morgan, John

    (Department of Economics, University of California, Berkeley)

  • Tumlinson, Justin

    (Department of Management, University of Exeter; TUM School of Management, Technical University of Munich,TUM School of Management)

  • Vardy, Felix

    (International Monetary Fund)

Abstract

In the context of Krugman (1979)'s canonical New Trade model, we demonstrate that a country is better off in autarky than in free and costless trade, if the productivity of its trading partner is low.

Suggested Citation

  • Morgan, John & Tumlinson, Justin & Vardy, Felix, 0. "When autarky trumps free and costless trade," Theoretical Economics, Econometric Society.
    • Handle: RePEc:the:publsh:6187
    as

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    References listed on IDEAS

    as
    1. Evgeny Zhelobodko & Sergey Kokovin & Mathieu Parenti & Jacques‐François Thisse, 2012. "Monopolistic Competition: Beyond the Constant Elasticity of Substitution," Econometrica, Econometric Society, vol. 80(6), pages 2765-2784, November.
    2. Fedor Slepov & Sergey Kokovin, 2023. "Equilibrium existence and uniqueness in additive trade models," HSE Working papers WP BRP 262/EC/2023, National Research University Higher School of Economics.
    3. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    Full references (including those not matched with items on IDEAS)

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    Keywords

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    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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