Increasing returns, monopolistic competition, and international trade: Revisiting gains from trade

• 成果类型: Article
• 署名作者: Kokovin, Sergey; Molchanov, Pavel; Bykadorov, Igor
• 署名单位: Russian Academy of Sciences; Siberian Branch of the Russian Academy of Sciences; Sobolev Institute of Mathematics; Novosibirsk State University; HSE University (National Research University Higher School of Economics); Centre National de la Recherche Scientifique (CNRS); Aix-Marseille Universite
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2022.103595
• 发表日期: 2022
• 关键词: Trade gains; monopolistic competition; Variable markups; Harmful trade; Autarky

摘要

We study the canonical Krugman (1979) trade model with non-CES preferences that yield autarky at finite trade costs. We prove a non-monotone impact of gradual trade liberalization. At first, near autarky, emerging trade reduces world welfare, while at free trade it becomes large enough to be beneficial (Krugman's result). This non-monotonicity persists under heterogenous firms. The harmful small-scale trade is explained by variable markups and underpriced imports, which become socially excessive. Unlike protectionists, we argue that liberalization should go far. On the other hand, we show that anti-dumping measures can be viewed as a remedy for the aforementioned imports distortion. (C) 2022 Published by Elsevier B.V.