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External Economies and International Trade Redux / Gene M. Grossman, Esteban Rossi-Hansberg.
- Format:
- Book
- Author/Creator:
- Grossman, Gene M.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w14425.
- NBER working paper series no. w14425
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2008.
- Summary:
- We study a world with national external economies of scale at the industry level. In contrast to the standard treatment with perfect competition and two industries, we assume Bertrand competition in a continuum of industries. In this setting, many of the "pathologies" of the standard treatment disappear. There typically exists a unique equilibrium with trade guided by "natural" comparative advantage. And, when a country has CES preferences and any finite elasticity of substitution between goods, gains from trade are assured.
- Notes:
- Print version record
- October 2008.
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