Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/90093
Authors: 
Batista, Catia
Potin, Jacques
Year of Publication: 
2013
Series/Report no.: 
IZA Discussion Paper 7765
Abstract: 
Recent research has documented a U-shaped industrial concentration curve over an economy's development path. How far can neoclassical trade theory take us in explaining this pattern? We estimate the production side of the Heckscher-Ohlin model using industry data on 44 developed and developing countries for the period 1976-2000. Decomposing the implied changes in industrial concentration over time shows that at least one third of these changes seems to be explained by a Rybczynski effect. This result suggests that capital accumulation led poor countries to diversify their industrial production, while rich countries made their production more concentrated in highly capital-intensive industries.
Subjects: 
economic growth and international trade
Heckscher-Ohlin
diversification
specialization
industrial concentration
structural change
JEL: 
F11
L16
O40
Document Type: 
Working Paper

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