Communication Costs and Trade of Differentiated Goods

Linghui Tang

Review of International Economics, 2006, vol. 14, issue 1, 54-68

Abstract: This paper investigates how the decline of communication costs affects the pattern of trade in differentiated goods. It is found that the development of information technology (IT) has significantly increased US imports of differentiated goods after the 1970s. In addition, the modern communication technology has assisted small economies from exporting homogeneous goods to exporting more and more differentiated goods in recent years.

Date: 2006
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