On Gravity,Specialization and Intra-industry Trade
E. Young Song ()
No 1007, Working Papers from Research Institute for Market Economy, Sogang University
This paper derives the necessary and sufficient condition for the simple gravity equation to hold: the market share of an exporting country is constant across all importing countries. Specialization is just one example satisfying this condition. It holds in a variety of situations where multiple producers compete with a homogeneous good.Further, this paper shows that the ratio of bilateral trade to the product of partner incomes is increasing in the extent of specialization and in the intensity of intra-industry trade. Since the relationship is not model-specific, the correlations among these variables do not support any specific model.
Keywords: gravity; specialization; intra-industry trade; Cournot; Heckscher-Ohlin (search for similar items in EconPapers)
JEL-codes: F11 F12 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
ftp://22.214.171.124/wpaper/SEY_RIME_2010-07.pdf First version, 2010 (application/pdf)
Journal Article: On Gravity, Specialization and Intra‐industry Trade (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:sgo:wpaper:1007
Access Statistics for this paper
More papers in Working Papers from Research Institute for Market Economy, Sogang University Contact information at EDIRC.
Bibliographic data for series maintained by Jung Hur ().