Specialization, Factor Accumulation and Development

Doireann Fitzgerald and Juan Hallak

No 10638, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We estimate the effect of factor proportions on the pattern of manufacturing specialization in a cross-section of OECD countries, taking into account that factor accumulation responds to productivity. We show that the failure to control for productivity differences produces biased estimates. Our model explains 2/3 of the observed differences in the pattern of specialization between the poorest and richest OECD countries. However, because factor proportions and the pattern of specialization co-move in the development process, their strong empirical relationship is not sufficient to determine whether specialization is driven by factor proportions, or by other mechanisms also correlated with level of development.

JEL-codes: F1 F11 (search for similar items in EconPapers)
Date: 2004-07
New Economics Papers: this item is included in nep-dev
Note: ITI
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Citations: View citations in EconPapers (31)

Published as Fitzgerald, Doireann and Juan Carlos Hallak. "Specialization, Factor Accumulation And Development," Journal of International Economics, 2004, v64(2,Dec), 277-302.

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Journal Article: Specialization, factor accumulation and development (2004)
Working Paper: Specialization, Factor Accumulation and Development (2002)
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