TY - JOUR
T1 - Internal geography, international trade, and regional specialization
AU - Kerem Coşar, A.
AU - Fajgelbaum, Pablo D.
PY - 2016
Y1 - 2016
N2 - We introduce an internal geography to the canonical model of international trade driven by comparative advantages to study the regional effects of external economic integration. The model features a dual-economy structure, in which locations near international gates specialize in export-oriented sectors while more distant locations do not trade with the rest of the world. The theory rationalizes patterns of specialization, employment, and relative incomes observed in developing countries that opened up to trade. We find regional specialization patterns consistent with the model in industry- level data from Chinese prefectures.
AB - We introduce an internal geography to the canonical model of international trade driven by comparative advantages to study the regional effects of external economic integration. The model features a dual-economy structure, in which locations near international gates specialize in export-oriented sectors while more distant locations do not trade with the rest of the world. The theory rationalizes patterns of specialization, employment, and relative incomes observed in developing countries that opened up to trade. We find regional specialization patterns consistent with the model in industry- level data from Chinese prefectures.
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U2 - https://doi.org/10.1257/mic.20140145
DO - https://doi.org/10.1257/mic.20140145
M3 - Article
SN - 1945-7669
VL - 8
SP - 24
EP - 56
JO - American Economic Journal: Microeconomics
JF - American Economic Journal: Microeconomics
IS - 1
ER -