The large volume of intra-industry trade is often cited as a critical element favoring trade theories based on increasing returns and imperfect competition over those with constant returns and perfect competition. The former provide an elegant account of intra-industry trade, while the latter, it is often argued, cannot. This paper provides an account of intra-industry trade based squarely on c...

This paper focuses on the question of whether labour standards can affect comparative advantage in unskilled-labour-intensive goods, and thereby influence trade flows. Using a Heckscher-Ohlin framework, the effects of low labour standards depend on the type of standard: Forced and child labour lead to an increase in the endowment of unskilled labour, and hence improve comparative advantage in u...

Abstract By simulating a multi-country general equilibrium international trade model, we investigate how the Economic Complexity Index (ECI) and Fitness (FI) are related directly to economic fundamentals with clear basis in theory. The model is based on Eaton Kortum (2002) combines factor endowment (Heckscher–Ohlin) technological (Ricardian) reasons for specialization, which further determines ...

En un contexto internacional como el actual, en que las pulsiones proteccionistas vuelven a campar sus anchas, resulta conveniente realizar una mirada retrospectiva hacia aquellas teorías económicas propugnan mayor liberalización comercial modelo de crecimiento económico. Desde los economistas clásicos y antecesores (Adam Smith David Ricardo, entre otros); hasta modelos planteados siglo XX (Hec...

Feldstein and Horioka (Econ J 90:314–329, 1980) observed that saving and investment move closely together in the major OECD countries. This finding is a puzzle if national economies are characterized by one sector neoclassical production functions—with diminishing returns to capital, a high level of savings in a country should create an incentive to export capital. In this paper, we show that t...

In spite of Latin America’s dismal economic performance between the 1950s and 1980s, the region experienced strong capital deepening. Furthermore, productivity (measured as TFP) grew at low rates in comparison with the U.S. In this paper, we suggest that all these facts can be explained as a consequence of the restrictive trade regime adopted at that time. Our analytical framework is based on a...