IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Painful Birth of Trade Under Classical Monopolistic Competition

Listed author(s):
  • Igor Bykadorov

    ()

    (National Research University Higher School of Economics)

  • Andrea Ellero

    ()

    (Ca Foscari University of Venice - Department of Management)

  • Stefania Funari

    ()

    (Ca Foscari University of Venice - Department of Management)

  • Sergey Kokovin

    ()

    (National Research University Higher School of Economics)

  • Pavel Molchanov

    ()

    (National Research University Higher School of Economics)

In the standard Krugman (1979) non-CES trade model, several asymmetric countries typically lose from increasing trade costs. However, all countries transiently benefit from such increase at the moment of closing trade, under almost-prohibitive trade costs (i.e., near autarky, which is possible only under non-CES preferences). In other words, during trade liberalization the first step from autarky to trade is necessarily harmful. Our explanation rests on market distortion and business destruction effects.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: https://www.hse.ru/data/2016/04/06/1127112143/132EC2016.pdf
Download Restriction: no

Paper provided by National Research University Higher School of Economics in its series HSE Working papers with number WP BRP 132/EC/2016.

as
in new window

Length: 35 pages
Date of creation: 2016
Publication status: Published in WP BRP Series: Economics / EC, April 2016, pages 1-35
Handle: RePEc:hig:wpaper:132/ec/2016
Contact details of provider: Postal:
Myasnitskaya 20, Moscow 101000

Phone: +7(495)7713232
Fax: +7(495)6287931
Web page: http://www.hse.ru/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window


  1. Brander, James & Krugman, Paul, 1983. "A 'reciprocal dumping' model of international trade," Journal of International Economics, Elsevier, vol. 15(3-4), pages 313-321, November.
  2. Behrens, Kristian & Kanemoto, Yoshitsugu & Murata, Yasusada, 2014. "New trade models, elusive welfare gains," CEPR Discussion Papers 10255, C.E.P.R. Discussion Papers.
  3. Bykadorov, Igor & Gorn, Alexey & Kokovin, Sergey & Zhelobodko, Evgeny, 2015. "Why are losses from trade unlikely?," Economics Letters, Elsevier, vol. 129(C), pages 35-38.
  4. Swati Dhingra & John Morrow, 2012. "The Impact of Integration on Productivity and Welfare Distortions Under Monopolistic Competition," FIW Working Paper series 088, FIW.
  5. Evgeny Zhelobodko & Sergey Kokovin & Mathieu Parenti & Jacques-François Thisse, 2011. "Monopolistic Competition in General Equilibrium: Beyond the CES," Discussion Paper Series DP2011-16, Research Institute for Economics & Business Administration, Kobe University.
  6. Igor Bykadorov & Andrea Ellero & Stefania Funari & Sergey Kokovin & Pavel Molchanov, 2015. "Pro-competitive effects and harmful trade liberalization in multi-country world," Working Papers 6, Department of Management, Università Ca' Foscari Venezia.
  7. Behrens, Kristian & Murata, Yasusada, 2007. "General equilibrium models of monopolistic competition: A new approach," Journal of Economic Theory, Elsevier, vol. 136(1), pages 776-787, September.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:hig:wpaper:132/ec/2016. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamil Abdulaev)

or (Victoria Elkina)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.