Implications of the Eaton-Kortum Model of International Trade
Robert Lucas and
Fernando Alvarez
No 623, 2004 Meeting Papers from Society for Economic Dynamics
Abstract:
This paper develops a general equilibrium model of world trade, based on the technology proposed by Eaton and Kortum. We study the existence and uniqueness of equilibrium. We propose and test an algorithm for calculating equilibria. We test the ability of a calibrated version of the model to account for trade volumes, and use the theory to simulate the gains from hypothetical trade liberalizations.
Keywords: trade; volume; gains (search for similar items in EconPapers)
JEL-codes: E F (search for similar items in EconPapers)
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed004:623
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