Trade and the Location of Two Industries: A Two-Factor Model Trade and the Location of Two Industries: A Two-Factor Model

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Author(s)

Abstract

We study a two-country two-factor model with free entry and monopolistic competition. There are two industries employing immobile labor as fixed input and mobile capital as marginal input. Firms cannot move across countries, but only move across industries within a country. The two industries can differ in three aspects: factor intensities, transport costs and demand elasticities. The two countries are identical except for size. The production specialization and trade pattern are the results of the interaction of two effects: the market access effect and the wage differential effect.

Journal

  • Interdisciplinary Information Sciences

    Interdisciplinary Information Sciences 22(1), 1-15, 2016

    Graduate School of Information Sciences, Tohoku University

Codes

  • NII Article ID (NAID)
    130005281141
  • Text Lang
    ENG
  • Article Type
    departmental bulletin paper
  • ISSN
    1340-9050
  • Data Source
    IR  J-STAGE 
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