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Property Rights, Mobile Capital, and Comparative Advantage

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  • Karp, Larry

Abstract

Recent papers show that imperfect property rights to a natural resource--a sector-specific factor--can be a source of comparative advantage. in these models, weaker property rights attract labor--the only mobile factor--to the resource sector, increasing the country's comparative advantage for that sector. If capital in addition to labor is mobile, and if the benefits of capital are non-excludable or if the degree of property rights is endogenous, a deterioration of property rights has ambiguous effects on comparative advantage and on the equilibrium wage-rental ratio.

Suggested Citation

  • Karp, Larry, 2004. "Property Rights, Mobile Capital, and Comparative Advantage," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt41h0b5v5, Department of Agricultural & Resource Economics, UC Berkeley.
    • Handle: RePEc:cdl:agrebk:qt41h0b5v5
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    References listed on IDEAS

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    More about this item

    Keywords

    JEL F02; F16; D23;
    All these keywords.

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

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