Input substitutability, trade costs and location

Tomasz Michalski

Economics Letters, 2012, vol. 117, issue 1, 57-59

Abstract: Constant unit manufacturing costs are lower (higher) in high wage North when inputs are (i) tradeable, (ii) country-specific and (iii) the elasticity of substitution between them is below (above) one. A two-country model of firm entry/location is considered.

Keywords: Input substitutability; Trade costs; North–South trade; Location (search for similar items in EconPapers)
JEL-codes: F12 O14 R30 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:117:y:2012:i:1:p:57-59

DOI: 10.1016/j.econlet.2012.04.105

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