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The Dynamics of International Trade Patterns

  • Paulo Bastos,
  • Manuel Cabral

This paper introduces new dynamic measures for examining changes in international trade patterns. Using data for 20 OECD countries over the 1980-2000 period, we show that inter-industry trade changes contrary to countries' previous specialisation are frequently the dominant form of trade expansion. The econometric analysis indicates that the observed changes in trade patterns were explained by initial endowments of human-capital and industry-specific changes in labour productivity and labour costs. The results also suggest that trade liberalisation induced an increase in the previous specialisation of larger OECD economies in industries with increasing returns to scale.

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File URL: http://www.nottingham.ac.uk/gep/documents/papers/2007/07-06.pdf
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Paper provided by University of Nottingham, GEP in its series Discussion Papers with number 07/06.

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Handle: RePEc:not:notgep:07/06
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