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Economic Integration in a Chamberlinian-Ricardian World

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  • Toru Kikuchi

Abstract

Based on a many-industry Chamberlinian-Ricardian trade model with iceberg trade costs, this note examines the impact of two modes of economic integration: a reduction in trade costs, and technical standardization due to information spillover. It is shown that these two modes of economic integration have opposing effects on specialization patterns: while trade liberalization narrows the range of industries with intra-industry trade, technical standardization widens the same range.

Suggested Citation

  • Toru Kikuchi, 2008. "Economic Integration in a Chamberlinian-Ricardian World," EERI Research Paper Series EERI_RP_2008_07, Economics and Econometrics Research Institute (EERI), Brussels.
  • Handle: RePEc:eei:rpaper:eeri_rp_2008_07
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    File URL: http://www.eeri.eu/documents/wp/EERI_RP_2008_07.pdf
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    References listed on IDEAS

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    1. Nicholas Sim, 2004. "International production sharing and economic development: moving up the value-chain for a small-open economy," Applied Economics Letters, Taylor & Francis Journals, vol. 11(14), pages 885-889.
    2. J. Peter Neary, 2003. "Competitive versus Comparative Advantage," The World Economy, Wiley Blackwell, vol. 26(4), pages 457-470, April.
    3. Venables, Anthony J, 1987. "Trade and Trade Policy with Differentiated Products: A Chamberlinian-Ricardian Model," Economic Journal, Royal Economic Society, vol. 97(387), pages 700-717, September.
    4. Toru Kikuchi & Koji Shimomura & Dao-Zhi Zeng, 2008. "On Chamberlinian-Ricardian Trade Patterns," Review of International Economics, Wiley Blackwell, vol. 16(2), pages 285-292, May.
    5. Luis A. Rivera-Batiz & Paul M. Romer, 1991. "Economic Integration and Endogenous Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 531-555.
    6. Rikard Forslid & Ian Wooton, 2003. "Comparative Advantage and the Location of Production," Review of International Economics, Wiley Blackwell, vol. 11(4), pages 588-603, September.
    7. Van Long, Ngo & Riezman, Raymond & Soubeyran, Antoine, 2005. "Fragmentation and services," The North American Journal of Economics and Finance, Elsevier, vol. 16(1), pages 137-152, March.
    8. Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, vol. 9(4), pages 469-479, November.
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    More about this item

    Keywords

    Monopolistic competition; Technical heterogeneity; Trade costs; Economic integration.;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

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