Procompetitive gains from trade and comparative advantage

Albert Schweinberger

No 155, Discussion Papers, Series II from University of Konstanz, Collaborative Research Centre (SFB) 178 "Internationalization of the Economy"

Abstract: The concepts of comparative and "noncomparative" advantagegains/losses from trade are made precise, related to each other and to an aggregate measure of trade gains in a general equilibrium model with increasing returns to scale and imperfect competition (with any finite number of goods and factors). Making use of concepts of the theory of output rationing a novel necessary condition for trade gains is derived and interpreted. Subject to certain assumptions the theorems of comparative advantage for goods trade and the H-0 theorem in its factor content form are generalized to economies with increasing returns to scale and imperfect competition.

Date: 1991
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Related works:
Journal Article: Procompetitive Gains from Trade and Comparative Advantage (1996)
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