Mobile capital, variable elasticity of substitution, and trade liberalization

Ching-Mu Chen, Dao Zhi Zeng

研究成果: Article査読

6 被引用数 (Scopus)

抄録

This article investigates the impact of trade liberalization on trade patterns, firm markups, and firm locations in a two-factor monopolistic competition model that features variable elasticity of substitution by a general additively separable utility. We find that, depending on the relative export hurdles, either direction of one-way trade may occur when trade opens up. Its direction determines the responses of firm-level markups and various home market effects to falling trade costs. Our results show that some important findings in the literature are robust only with particular classes of preferences. We provide a possible rationale for some well-known conflicting empirical facts.

本文言語English
ページ(範囲)461-494
ページ数34
ジャーナルJournal of Economic Geography
18
2
DOI
出版ステータスPublished - 2018 3月 1

ASJC Scopus subject areas

  • 地理、計画および開発
  • 経済学、計量経済学

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