How Liberalization of Trade in Services May Conserve Natural Resources
A three-sector model of trade and location where two sectors produce intermediate inputs to the third sector is constructed. One of the intermediate sectors is located in the South and produces a freely traded homogenous input, while the other produces a differentiated input which is traded subject to transport costs. The impact of declining transport costs is anlyzed. Multiple equilibria occur for reasonable parameter values, but none of the equilibria involves agglomeration.
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|Date of creation:||1997|
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