Asymmetric Country‐of‐Origin Effects on Intraindustry Trade and the International Quality Race

Arnab Basu and Nancy Chau

Review of Development Economics, 1998, vol. 2, issue 2, 140-166

Abstract: A model of North–South intraindustry trade in quality differentiated products is proposed to examine the role of country‐of‐origin reputation in determining the competitive edge of emerging industries. It is shown that if consumers rationally harbor negative expectations about the quality of Southern products, economic progress in either the North or the South shifts the terms of trade against Southern exports, and worsens Southern producers' incentive to produce high‐quality products. In addition, the paper illustrates the role of income redistributive policies in shifting consumer's demand in favor of Southern high‐quality products.

Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://doi.org/10.1111/1467-9361.00034

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:rdevec:v:2:y:1998:i:2:p:140-166

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1363-6669

Access Statistics for this article

Review of Development Economics is currently edited by E. Kwan Choi

More articles in Review of Development Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().