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| Author: | Davis, D. R. Weinstein, D. E. |
| Title: | Market Access, Economic Geography and Comparative Advantage: an Empirical Test |
| Journal: | Journal of International Economics
2003 : JAN, VOL. 59:1, p. 1-24 |
| Index terms: | COMPARATIVE ADVANTAGE ECONOMIC GEOGRAPHY OECD INTERNATIONAL TRADE |
| Language: | eng |
| Abstract: | Traditional neoclassical models of comparative advantage suggest that, all else equal, a country with idiosyncratically strong demand for a good will be an importer of that good. However, there is a contrary tradition that emphasizes the advantages of a large home market as a foundation for exports of a good. One recent formalization of this home market approach falls within what is termed the new economic geography. This paper integrates core models of Heckscher-Ohlin and Krugman to investigate whether such home market effects matter empirically in manufacturing for a set of OECD countries. The evidence suggests that home market effects are important for a broad segment of OECD manufacturing. |
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