The determinants of bilateral trade

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review

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Author(s)

Detail(s)

Original languageEnglish
Pages (from-to)459-483
Journal / PublicationCanadian Journal of Economics
Volume37
Issue number2
Online published22 Apr 2004
Publication statusPublished - May 2004
Externally publishedYes

Abstract

In this paper we present a monopolistic competition model that incorporates asymmetric trade barriers and international differences in production costs. The model implies a highly non-linear bilateral trade equation. Estimation of this equation yields parameters for the elasticity of substitution and trade costs that are more reasonable than those found in previous studies. A simulation indicates that trade liberalization will shift trade from rich countries to poor countries and from within continental trading partners with preferential trade agreements to intercontinental trading partners. © Canadian Economics Association.

Citation Format(s)

The determinants of bilateral trade. / Lai, Huiwen; Zhu, Susan Chun.
In: Canadian Journal of Economics, Vol. 37, No. 2, 05.2004, p. 459-483.

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review