C HAPTER 6 ECONOMICS OF SCALE, IMPERFECT COMPETITION, AND INTERNATIONAL TRADE.
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Transcript of C HAPTER 6 ECONOMICS OF SCALE, IMPERFECT COMPETITION, AND INTERNATIONAL TRADE.
The Imitation Lag Hypothesis
– The Imitation Lag Hypothesis• Michael V. Posner(1961) • Imitation lag-demand lag=net lag
– The Product Cycle Theory• Michael V. Posner(1966)• A typical “new product”(F2)• Dynamic comparative advantage• Test: there should be a positive correlation
between R&D expenditures and successful export performance by industry.
• Dinopoulos, Oehmker and Segerstrom(1993)
The trade pattern in the Product Cycle Theory
time
Production,consumption of product
production
consumption
New product stage Maturing product stage
Standardized product stage
Exports Imports
The Linder Theory
• Staffan Burenstam Linder(1961)
• Demand-oriented
• Overlapping demand
• International trade in manufactured goods will be more intense between countries with similar per capita income levels than between countries with dissimilar per capita income levels.
• Tests: the greater the difference between the per capita incomes of country and its trading partner, the less intensely the two countries will trade with each other.
Overlapping Demands in the Linder Model
Income levels
Goods
A
B
H
GF
E
D
C
I
Country 1’s income
Cou
ntry
1’s
dem
and
and
prod
ucti
onCou
ntry
2’s
dem
and
and
prod
ucti
on
Country 2’s income
The Kemp Model
•Murray C. Kemp(1964)
•Economies of scale (external economies) and a convex PPF
• A multitude of trading possibilities
The Convex PPF and Different Possible TOT
X
Y
PX/PY
E
F
M
N
TOT1
TOT2
TOT3
The existence of economies of scale generates considerable uncertainty concerning the production and trade pattern.
The Krugman Model
•Paul Krugman(1979)
•Economies of scale( internal to the firm) and monopolistic competition
贸易前 A国市场
贸易前 B国市场
贸易后一体化市场
汽车总销售量 900 000 1 600 000 2 500 000
厂商数 6 8 10
每个厂商销售量 150 000 200 000 250 000
平均成本 1 000 875 800
市场价格 1 000 875 800
Other Post-H-O theories
•Reciprocal dumping model–Brander and Krugman(1983)
Duopoly market
–Trade in a homogeneous product
–Positive welfare aspect: pro-competitive effect
–Negative welfare aspect: waste
Intra-Industry Trade
– Reasons for IIT in Product Category
• Product differentiation
• Transport costs and geographical location
• Dynamic economies of scale
• Degree of product aggregation
• Differing income distributions in countries
• Differing factor endowments and product variety