Market size, division of labor, and firm productivity

• 成果类型: Article
• 署名作者: Chaney, Thomas; Ossa, Ralph
• 署名单位: University of Chicago; University of Chicago
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2012.11.003
• 发表日期: 2013
• 页码: 177-180
• 关键词: Market size; division of labor; Firm productivity; Technology transfer

摘要

We generalize Krugman's (1979) 'new trade' model by allowing for an explicit production chain in which a range of tasks is performed sequentially by a number of specialized teams. We demonstrate that an increase in market size induces a deeper division of labor among these teams which leads to an increase in firm productivity. The paper can be thought of as a formalization of Smith's (1776) famous theorem that the division of labor is limited by the extent of the market. It also sheds light on how market size differences can limit the scope for international technology transfers. (C) 2012 Elsevier B.V. All rights reserved.