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Comparative advantage and the location of production

Forslid, R. and Wooton, I. (2003) Comparative advantage and the location of production. Review of International Economics, 11 (4). pp. 588-603. ISSN 0965-7576

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Abstract

The paper returns to a familiar topic in international trade, comparative advantage, introducing it into Krugman's classic, core-periphery model of economic geography. This extra force of dispersion radically changes the stability properties of the model. Instead of the familiar result that trade liberalization leads to increased industrial concentration, lowering trade costs leads initially to increased concentration and then to dispersion of production. When a pattern of comparative advantage exists, integration may lead to international specialization of production. This may be good news for peripheral countries, which may be able to retain industry despite the attraction of the core.

Item type: Article
ID code: 3905
Keywords: economic production, economics, competition, international economics, trade, Economic Theory, Development, Geography, Planning and Development
Subjects: Social Sciences > Economic Theory
Department: Strathclyde Business School > Economics
Related URLs:
    Depositing user: Strathprints Administrator
    Date Deposited: 23 Aug 2007
    Last modified: 04 Sep 2014 11:34
    URI: http://strathprints.strath.ac.uk/id/eprint/3905

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