The pro-competitive gains from trade with variable markup and multiple factors
The paper investigates the welfare gains from trade liberalization in the presence of multiple factors, multiple industries and variable markup. We extend Bernard, Redding and Schott (2007) to incorporate variable markup, using additively separable utility. We then characterize the equilibrium un...
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sg-ntu-dr.10356-699342019-12-10T11:57:37Z The pro-competitive gains from trade with variable markup and multiple factors Chen, Yongxiao Li, Xinxin Liu, Yaxin Chen Xin School of Humanities and Social Sciences Chen Xiaoping DRNTU::Humanities The paper investigates the welfare gains from trade liberalization in the presence of multiple factors, multiple industries and variable markup. We extend Bernard, Redding and Schott (2007) to incorporate variable markup, using additively separable utility. We then characterize the equilibrium under costly trade and discuss the welfare implications of Heckscher-Ohlin mechanism, as well as the variable markup. Our main nding is that gains from trade liberalization are higher in models with variable markup than those with constant markup when the Heckscher-Ohlin force is strong enough. The larger the trade cost decreases, the stronger the Heckscher-Ohlin force is. We conclude that the pro-competitive e ect of trade liberalization does exist in the presence of Heckscher-Ohlin comparative advantage and variable markup. Bachelor of Arts 2017-04-04T04:13:56Z 2017-04-04T04:13:56Z 2017 Final Year Project (FYP) http://hdl.handle.net/10356/69934 en Nanyang Technological University 39 p. application/pdf |
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DRNTU::Humanities Chen, Yongxiao Li, Xinxin Liu, Yaxin The pro-competitive gains from trade with variable markup and multiple factors |
description |
The paper investigates the welfare gains from trade liberalization in the presence of multiple
factors, multiple industries and variable markup. We extend Bernard, Redding and Schott
(2007) to incorporate variable markup, using additively separable utility. We then characterize
the equilibrium under costly trade and discuss the welfare implications of Heckscher-Ohlin
mechanism, as well as the variable markup. Our main nding is that gains from trade liberalization
are higher in models with variable markup than those with constant markup when the
Heckscher-Ohlin force is strong enough. The larger the trade cost decreases, the stronger the
Heckscher-Ohlin force is. We conclude that the pro-competitive e ect of trade liberalization
does exist in the presence of Heckscher-Ohlin comparative advantage and variable markup. |
author2 |
Chen Xin |
author_facet |
Chen Xin Chen, Yongxiao Li, Xinxin Liu, Yaxin |
format |
Final Year Project |
author |
Chen, Yongxiao Li, Xinxin Liu, Yaxin |
author_sort |
Chen, Yongxiao |
title |
The pro-competitive gains from trade with variable markup and multiple factors |
title_short |
The pro-competitive gains from trade with variable markup and multiple factors |
title_full |
The pro-competitive gains from trade with variable markup and multiple factors |
title_fullStr |
The pro-competitive gains from trade with variable markup and multiple factors |
title_full_unstemmed |
The pro-competitive gains from trade with variable markup and multiple factors |
title_sort |
pro-competitive gains from trade with variable markup and multiple factors |
publishDate |
2017 |
url |
http://hdl.handle.net/10356/69934 |
_version_ |
1681039226998620160 |