Scale Economies and International Trade in a Rapidly Growing Region

Byron L. David () and Mitchell H. Kellman
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Byron L. David: The City College of New York, Postal: Department of Economics, The City College of New York, 138th St. and Convent Ave. New York, NY 10031, U.S.A
Mitchell H. Kellman: The City College of New York, Postal: The City College of New York

Journal of Economic Integration, 1997, vol. 12, 26-46

Abstract:

Scale is universally acknowledged as important in the determination of national comparative advantage. Paradoxically, attempts to associate empiri - cal measures of scale economies and international trade volume have proved largely inconclusive, and often have been found to sport the “wrong” sign. We examine the trade-scale nexus in the context of East Asian NICs and “Next- Tier” NICs whose economies and exports have grown especially rapidly since the mid-1960s. In a cross section context we replicate the negative correlations typically found in the literature. By combining time section and cross section analyses we demonstrate significant positive correlations in a dynamic context, finding that the smaller the country the greater the scale economy gains for any given population increase.

Keywords: Scale; Economies (search for similar items in EconPapers)
JEL-codes: F12 (search for similar items in EconPapers)
Date: 1997
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:integr:0037

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