International Trade in Differentiated Middle Products

Elhanan Helpman

Chapter 1 in Structural Adjustment in Developed Open Economies, 1985, pp 3-34 from Palgrave Macmillan

Abstract: Abstract The theory of international trade has been extended in recent years to deal with intra-industry trade.2 These extensions aim to explain certain facts about existing trade patterns, which cannot be explained by the traditional comparative costs theory (Ricardo) and the traditional relative factor abundance theory (Heckscher-Ohlin). They are based on the existence of product differentiation, economies of scale and monopolistic competition. They provide an explanation of trade which is complementary to the traditional views and it has, indeed, been shown by several authors that both explanations can coexist in extended models of international trade (see Helpman, 1984, for a review of this literature).

Keywords: Finished Good; Intermediate Good; Intermediate Input; Price Function; Trade Pattern (search for similar items in EconPapers)
Date: 1985
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Persistent link: https://EconPapers.repec.org/RePEc:pal:intecp:978-1-349-17919-0_1

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DOI: 10.1007/978-1-349-17919-0_1

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