Trade, Domestic Frictions, and Scale Effects

• 成果类型: Article
• 署名作者: Ramondo, Natalia; Rodriguez-Clare, Andres; Saborio-Rodriguez, Milagro
• 署名单位: University of California System; University of California San Diego; National Bureau of Economic Research; University of California System; University of California Berkeley; Universidad Costa Rica
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20141449
• 发表日期: 2016
• 页码: 3159-3184
• 关键词: product differentiation; INTERNATIONAL-TRADE; increasing returns; GROWTH; TECHNOLOGY; geography; pattern; models; gains; ideas

摘要

Because of scale effects, idea-based growth models imply that larger countries should be much richer than smaller ones. New trade models share the same counterfactual feature. In fact, new trade models exhibit other counterfactual implications associated with scale effects: import shares decrease and relative income levels increase too steeply with country size. We argue that these implications are largely a result of the standard assumption that countries are fully integrated domestically. We depart from this assumption by treating countries as collections of regions that face positive costs to trade among themselves. The resulting model is largely consistent with the data.