 Technical change in a Ricardian model of North-South trade with increasing returns to scaleThe Journal of International Trade & Economic Development, 1998, vol. 7, issue 2, 207-220 Abstract: This paper examines the effect of a technical change on the pattern of North-South trade in the presence of increasing returns to scale in production. The model shows that if the North initially takes advantage of the economies of scale in advance of the South, the relative wage will be higher in the North, the North will specialize in goods with the highest economies of scale and the South in the remaining goods. A technical improvement in the South or a uniform technical improvement will make both countries better-off as long as the price of Southern goods falls. Likewise, a technical improvement in the North will lead to a welfare improvement in both countries without altering the pattern of comparative advantage. Keywords: International trade; development; technical change; economies of scale (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:jitecd:v:7:y:1998:i:2:p:207-220 Ordering information: This journal article can be ordered from DOI: 10.1080/09638199800000011 Access Statistics for this article The Journal of International Trade & Economic Development is currently edited by Pasquale Sgro, David E.A. Giles and Charles van Marrewijk More articles in The Journal of International Trade & Economic Development from Taylor & Francis Journals |
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