Per capita income, market access costs, and trade volumes
In: Journal of international economics, Band 86, Heft 2, S. 284-294
ISSN: 0022-1996
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In: Journal of international economics, Band 86, Heft 2, S. 284-294
ISSN: 0022-1996
In: The Scandinavian Journal of Economics, Band 114, Heft 4, S. 1296-1317
SSRN
In: Far Eastern affairs: a Russian journal on China, Japan and Asia-Pacific Region ; a quarterly publication of the Institute for Far Eastern Studies, Russian Academy of Sciences, Band 38, Heft 4, S. 52-60
ISSN: 0206-149X
In: The B.E. journal of theoretical economics, Band 9, Heft 1
ISSN: 1935-1704
This paper explores how income distribution affects market structure, prices, and economic well-being of different consumer groups. I consider a general equilibrium model of monopolistic competition with free entry, heterogenous firms and consumers that share identical but non-homothetic preferences. The results in the paper suggest that poverty reduction might be of a greater importance than lowering income inequality, as lower income inequality does not necessarily lead to welfare gains of the poor. In particular, I show that higher income inequality may benefit the poor via a trickle-down effect operating through the entry of firms into the market.
In: Svobodnaja mysl' - XXI: teoretičeskij i političeskij žurnal, Band 56, Heft 12, S. 101-112
ISSN: 0869-4435
In: Svobodnaja mysl' - XXI: teoretičeskij i političeskij žurnal, Band 56, Heft 8, S. 88-110
ISSN: 0869-4435
In: Comparative strategy, Band 19, Heft 1, S. 69-77
ISSN: 0149-5933
World Affairs Online
In: Comparative strategy, Band 19, Heft 1, S. 69-77
ISSN: 1521-0448
In: Kiel working paper no. 2181 (April 2021)
The distribution of transport infrastructure across space is the outcome of deliberate government planning that reflects a desire to unlock the welfare gains from regional economic integration. Yet, despite being one of the oldest government activities, the economic forces shaping the endogenous emergence of infrastructure have not been rigorously studied. This paper provides a stylized analytical framework of open economies in which planners decide non-cooperatively on transport infrastructure investments across continuous space. Allowing for intra- and international trade, the resulting equilibrium investment schedule features underinvestment that turns out particularly severe in border regions and that is amplified by the presence of discrete border costs. In European data, the mechanism explains about 16% of the border effect identified in a conventionally specified gravity regression.
The distribution of transport infrastructure across space is the outcome of deliberate government planning that reflects a desire to unlock the welfare gains from regional economic integration. Yet, despite being one of the oldest government activities, the economic forces shaping the endogenous emergence of infrastructure have not been rigorously studied. This paper provides a stylized analytical framework of open economies in which planners decide non-cooperatively on transport infrastructure investments across continuous space. Allowing for intra- and international trade, the resulting equilibrium investment schedule features underinvestment that turns out particularly severe in border regions and that is amplified by the presence of discrete border costs. In European data, the mechanism explains about 16% of the border effect identified in a conventionally specified gravity regression.
BASE
In: CESifo Working Paper No. 9309
SSRN
In: CESifo Working Paper No. 8652
SSRN
Working paper
In: ZEW - Centre for European Economic Research Discussion Paper No. 20-061
SSRN
Working paper
In: The Canadian journal of economics: the journal of the Canadian Economics Association = Revue canadienne d'économique, Band 48, Heft 4, S. 1561-1599
ISSN: 1540-5982
AbstractThis paper quantitatively explores the role of demand in explaining the positive correlation between an importer's per capita income and the extensive margin of bilateral trade. The theoretical mechanism is based on agents that increase the set of goods they consume with income. This affects the structure of a country's import demand and therewith the extensive margin of trade. We formalize this intuition by incorporating preferences that allow for binding non‐negativity constraints into an otherwise standard Ricardian multi‐country model. We quantify the model and find that the behaviour of the model's extensive margin of trade is consistent with the data.
This paper identifies a new reason for giving preferences to the disadvantaged using a model of contests. There are two forces at work: the effort effect working against giving preferences and the selection effect working for them. When education is costly and easy to obtain (as in the U.S.), the selection effect dominates. When education is heavily subsidized and limited in supply (as in India), preferences are welfare reducing. The model also shows that unequal treatment of identical agents can be welfare improving, providing insights into when the counterintuitive policy of rationing educational access to some subgroups is welfare improving.
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