Monopolistic Competition and International Trade: Reconsidering the Evidence

David Hummels and James Levinsohn

No 4389, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In this paper, we test some propositions about international trade flows that are derived from a model of monopolistic competition developed by Elhanan Helpman. We investigate whether the volume of trade between OECD countries is consistent with the predictions of a modal in which all trade is intra-industry trade in differentiated products. We then repeat the test with non-OECD countries. We also investigate whether the share of intra-industry trade is consistent with a more general theoretical model in which some, but not all, trade is intra-industry trade. Our results lead us to question the apparent empirical success of these models.

JEL-codes: F1 (search for similar items in EconPapers)
Date: 1993-06
Note: ITI
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Published as Quarterly Journal of Economics, vol. CX, no. 3, pp 799-836, 1995.

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Journal Article: Monopolistic Competition and International Trade: Reconsidering the Evidence (1995)
Working Paper: Monopolistic Competition and International Trade: Reconsidering the Evidence (1993)
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