IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Explaining Trade Flows: Traditional and New Determinants of Trade Patterns

  • Gourdon, Julien

An empirical tradition in international trade seeks to establish whether the predictions of factor abundance theory match with the data. The relation between factor endowments and trade in goods (commodity version of Hecksher-Ohlin) provide mildly encouraging empirical results. But in the analysis of factor service trade and factor endowments (factor content version of HO), the results show that it performs poorly and reject strict HOV models in favor of modifications that allow for technology differences, consumer’s preferences differences, increasing returns to scale or cost of trade. In this paper we test if these “new” determinants help us to improve our estimation of trade patterns in commodities. Since the commodity version allows obtaining a large panel data we also compare two periods, pre and post 1980. We use a Heckman procedure to allow for non linearity in the relation between factors endowments and net exports and between trade intensity and net exports. The results show that adding the “new” determinants of factor content studies help us to improve the prediction of being specialized in the different manufactured products. However specialization according to factor endowments is stronger than ever, especially concerning the specialization according to human capital endowment. Trade patterns are also determined by trade intensity. Here differences in technology, trade policy, transport and transaction costs, explain the difference in trade intensity.

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: http://mpra.ub.uni-muenchen.de/4175/1/MPRA_paper_4175.pdf
File Function: original version
Download Restriction: no

File URL: http://mpra.ub.uni-muenchen.de/33347/1/MPRA_paper_33347.pdf
File Function: revised version
Download Restriction: no

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 4175.

as
in new window

Length:
Date of creation: Jan 2006
Date of revision:
Handle: RePEc:pra:mprapa:4175
Contact details of provider: Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

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:pra:mprapa:4175. 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: (Ekkehart Schlicht)

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.