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dc.contributor.authorKeuschnigg, Christianen_US
dc.contributor.authorEgger, Peteren_US
dc.description.abstractSince innovative firms are often financially constrained, access to external funds is important for the expansion of innovative industries. This paper reports four important results. First, comparative advantage is shaped by factor endowments as well as fundamental determinants of corporate finance. In particular, a larger equity ratio of firms and tough governance standards relax finance constraints and create a comparative advantage in innovative industries. Second, factor price equalization requires symmetry not only in the production but also in the intermediation technology. Third, a small degree of protection in the constrained sector can raise welfare by relaxing finance constraints if terms of trade effects are small. Fourth, a small degree of protection of the financially dependent industry might even raise world welfare if the other country is financially well developed.en_US
dc.publisherVerein für Socialpolitik Frankfurt a. M.en_US
dc.relation.ispartofseriesBeiträge zur Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie - Session: Trade and Finance E2-V3en_US
dc.subject.keywordFinance constraintsen_US
dc.subject.keywordcomparative advantageen_US
dc.titleCorporate Finance and Comparative Advantageen_US
dc.typeConference Paperen_US
Appears in Collections:Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie

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