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http://dspace.mediu.edu.my:8181/xmlui/handle/10419/18243| Title: | Market Size and Factor Endowment: Explaining Comparative Advantage in Bilateral Trade by Differences in Income and Per Capita Income |
| Keywords: | F12 ddc:330 Gravity model comparative advantage bilateral trade home market effect factor endowment Internationale Wirtschaftsbeziehungen Außenwirtschaft Gravitationsmodell Komparativer Kostenvorteil Landesgröße Volkseinkommen Faktorproportionentheorem Sozialprodukt Schätzung Theorie Welt Marktgröße |
| Issue Date: | 16-Oct-2013 |
| Publisher: | Deutsches Institut für Wirtschaftsforschung (DIW) Berlin |
| Description: | Using a gravity-type explanation of international trade flows at the industry level, it is shown that the pattern of comparative advantage in terms of sectoral export/import ratios in bilateral trade can be explained by relative income and relative per capita income. Total income of a country is a proxy of its economic size and has a positive effect on comparative advantage in most manufacturing industries (home market effect). Per capita income represents the capital-labour endowment ratio and demand conditions. In sum, it has a positive effect in (human) capital-intensive industries and a negative effect in labour-intensive industries. |
| URI: | http://koha.mediu.edu.my:8181/xmlui/handle/10419/18243 |
| Other Identifiers: | http://hdl.handle.net/10419/18243 ppn:336175302 |
| Appears in Collections: | EconStor |
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