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Intra-industry trade and labor costs: The smooth adjustment hypothesis


  • Manuel A. Ferreira
  • José A. Filipe
  • Manuel Coelho


We study a situation in which, owing to the exhaustion of non-renewable energy sources, conventional motor vehicles will turn out of use. We consider two scenarios: recycling or dismantling these motor vehicles. M|G|∞ queue system is used to study the process. Through it, we conclude that if the rate of dismantling and recycling of motor vehicles is greater than the rate at which they become idle, the system will tend to get balanced. The model allows also performing a brief study about the recycling or dismantling economic interest.

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  • Manuel A. Ferreira & José A. Filipe & Manuel Coelho, 2009. "Intra-industry trade and labor costs: The smooth adjustment hypothesis," Working Papers Department of Economics 2009/18, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
  • Handle: RePEc:ise:isegwp:wp182009

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