Fondazione Eni Enrico Mattei (FEEM), Mailand >
FEEM Working Papers, Fondazione Eni Enrico Mattei >
Please use this identifier to cite or link to this item:
| || |
|Title:||Beyond the home market effect: Market size and specialization in a multi-country world |
Lamorgese, Andrea R.
Ottaviano, Gianmarco I. P.
|Issue Date:||2009 |
|Series/Report no.:||Nota di lavoro // Fondazione Eni Enrico Mattei: Global challenges 119.2009|
|Abstract:||The standard two-country model of international trade with monopolistic competition predicts a more-than-proportional relationship between a country's share of world production of a good and its share of world demand for that same good, a result known as the home market effect. We first show that this prediction does not generally carry through to the multi-country case, as production patterns are crucially affected by third country effects. We then derive an alternative prediction that holds whatever the number of countries considered. This new prediction takes into account important features of the real world such as comparative advantage due to cross-country technological differences and lack of factor price equalization.|
Home Market Effect
|Document Type:||Working Paper|
|Appears in Collections:||FEEM Working Papers, Fondazione Eni Enrico Mattei |
Download bibliographical data as:
Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.