Developing Countries in Light of Intra-Trade
This paper examines one possible explanation for intra-trade flows derived in light of an international environment characterized by product differentiation, economies of scale, and monopolistic competition. The analysis may be structured within a more general formulated Heckscher-Ohlin framework, in which intra-trade flows may be explained through product differentiation while conventional explanations apply to inter-industry trade (see e.g. Helpman (1981), (1984), Kierzkowski (1984)). The model analyses the relationship between the total volume of trade, the share of intra-trade on cross-country differences in relative factor endowments and relative country size in a simple integrated two country world.
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- Helpman, Elhanan, 1981. "International trade in the presence of product differentiation, economies of scale and monopolistic competition : A Chamberlin-Heckscher-Ohlin approach," Journal of International Economics, Elsevier, vol. 11(3), pages 305-340, August.
- David Greenaway, 1983. "Intra-industry and inter-industry trade in Switzerland," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 119(1), pages 109-121, March.
- Broll, Udo & Gilroy, Bernard Michael, 1985. "International Division of Labour and Intra-Trade," MPRA Paper 18042, University Library of Munich, Germany.
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