Goods trade, factor mobility and welfare

Redding, Stephen

Goods trade, factor mobility and welfare

Journal of International Economics, 2016, vol. 101, issue C, 148-167

Abstract: We develop a quantitative spatial model that incorporates a rich geography of trade costs and labor mobility with heterogeneous worker preferences across locations. We provide comparative statics for the unique equilibrium with respect to the primitives of the model. We show how the model can be used to undertake counterfactuals using only data in an initial equilibrium. In these counterfactuals, the welfare gains from trade depend on changes in both domestic trade shares and reallocations of population across locations. We show that factor mobility introduces quantitatively relevant differences in the counterfactual predictions of constant and increasing returns to scale models.

Keywords: International trade; Factor mobility; Welfare gains from trade (search for similar items in EconPapers)
JEL-codes: F11 F12 F16 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (205)

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Related works:
Working Paper: Goods Trade, Factor Mobility and Welfare (2012)
Working Paper: Goods trade, factor mobility and welfare (2012)
Working Paper: Goods Trade, Factor Mobility and Welfare (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:101:y:2016:i:c:p:148-167

DOI: 10.1016/j.jinteco.2016.04.003

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