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TDoes Product Differentiation Explain The Increase in Exports of Transition Countries?

  • Yener Kandogan

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    The paper analyzes the increase in transition countries’ exports to their non-traditional trade partners. It uses four different measures of product differentiation to find out the extent that the increase in product variety explains this phenomenon. It is found that opening up to new trade partners first increases the number of sectors in which trade occurs. This is followed by a brief period of specialization in some select sectors, and finally an increase in the number of varieties of products in these sectors. Lastly, the increase in product variety in CEEC has been much more substantial than in CIS.

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    File URL: http://www.wdi.umich.edu/files/Publications/WorkingPapers/wp599.pdf
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    Paper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number 2003-599.

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    Length: 23 pages
    Date of creation: 01 Jul 2003
    Date of revision:
    Handle: RePEc:wdi:papers:2003-599
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    1. Hummels, D. & Levinsohn, J., 1993. "Monopolistic Competition and International Trade: Reconsidering the Evidence," Working Papers 339, Research Seminar in International Economics, University of Michigan.
    2. Gary Hufbauer, 1970. "The Impact of National Characteristics & Technology on the Commodity Composition of Trade in Manufactured Goods," NBER Chapters, in: The Technology Factor in International Trade, pages 145-231 National Bureau of Economic Research, Inc.
    3. Feenstra, Robert C & Markusen, James R, 1994. "Accounting for Growth with New Inputs," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 35(2), pages 429-47, May.
    4. Michael Funke, 2000. "Product Variety and Economic Growth; Empirical Evidence for the Oecd Countries," IMF Working Papers 00/5, International Monetary Fund.
    5. Feenstra, Robert C. & Madani, Dorsati & Yang, Tzu-Han & Liang, Chi-Yuan, 1999. "Testing endogenous growth in South Korea and Taiwan," Journal of Development Economics, Elsevier, vol. 60(2), pages 317-341, December.
    6. David Hummels & Peter J. Klenow, 2002. "The Variety and Quality of a Nation's Trade," NBER Working Papers 8712, National Bureau of Economic Research, Inc.
    7. Djankov, Simeon & Hoekman, Bernard, 1996. "Intra-Industry Trade, Foreign Direct Investment and the Reorientation of East European Exports," CEPR Discussion Papers 1377, C.E.P.R. Discussion Papers.
    8. repec:cup:cbooks:9780521480857 is not listed on IDEAS
    9. Hummels, David & Levinsohn, James A, 1993. "Product Differentiation as a," American Economic Review, American Economic Association, vol. 83(2), pages 445-49, May.
    10. Hummels, D. & Levinsohn, J., 1993. "Product Differentiation as a Source of Comparative Advantage?," Working Papers 324, Research Seminar in International Economics, University of Michigan.
    11. Harrigan, James, 1996. "Openness to trade in manufactures in the OECD," Journal of International Economics, Elsevier, vol. 40(1-2), pages 23-39, February.
    12. Feenstra, Robert C, 1994. "New Product Varieties and the Measurement of International Prices," American Economic Review, American Economic Association, vol. 84(1), pages 157-77, March.
    13. Muscatelli, Vito Antonio & Stevenson, Andrew A & Montagna, Catia, 1995. "Modeling Aggregate Manufactured Exports for Some Asian Newly Industrialized Economies," The Review of Economics and Statistics, MIT Press, vol. 77(1), pages 147-55, February.
    14. Helpman, Elhanan, 1987. "Imperfect competition and international trade: Evidence from fourteen industrial countries," Journal of the Japanese and International Economies, Elsevier, vol. 1(1), pages 62-81, March.
    15. Chonira Aturupane & Simeon Djankov & Bernard Hoekman, 1999. "Horizontal and vertical intra-industry trade between Eastern Europe and the European union," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 135(1), pages 62-81, March.
    16. Feenstra, Robert C. & Yang, Tzu-Han & Hamilton, Gary G., 1999. "Business groups and product variety in trade: evidence from South Korea, Taiwan and Japan," Journal of International Economics, Elsevier, vol. 48(1), pages 71-100, June.
    17. Y. Kandogan, 2003. "Reconsidering the adjustment costs of the Europe agreements," Applied Economics Letters, Taylor & Francis Journals, vol. 10(2), pages 63-68.
    18. Brenton, Paul & Gros, Daniel, 1997. "Trade Reorientation and Recovery in Transition Economies," Oxford Review of Economic Policy, Oxford University Press, vol. 13(2), pages 65-76, Summer.
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