TY - UNPB

T1 - The gains from external scale economies and comparative advantage

AU - Soo, Kwok Tong

PY - 2013/6

Y1 - 2013/6

N2 - This paper develops a many-good, many-country model of international tradewhich combines comparative advantage and external scale economies. It is shownthat the gains from external scale economies outweigh those from comparativeadvantage as the number of goods increases. Small countries gain more than largecountries from trade, because large countries are more similar to the rest of theworld than small countries. Small countries are also more specialised inproduction than large countries, despite the presence of external scale economies.

AB - This paper develops a many-good, many-country model of international tradewhich combines comparative advantage and external scale economies. It is shownthat the gains from external scale economies outweigh those from comparativeadvantage as the number of goods increases. Small countries gain more than largecountries from trade, because large countries are more similar to the rest of theworld than small countries. Small countries are also more specialised inproduction than large countries, despite the presence of external scale economies.

KW - External scale economies

KW - Comparative advantage

KW - Gains from trade

M3 - Working paper

T3 - Economics Working Paper Series

BT - The gains from external scale economies and comparative advantage

PB - Lancaster University, Department of Economics

CY - Lancaster

ER -