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International Trade with Lumpy Countries

Archived Abstract of Former PSC Researcher

Courant, Paul, and Alan Deardorff. 1992. "International Trade with Lumpy Countries." Journal of Political Economy, Vol 100 (February), 198-210.

This paper explores the implications for the pattern of international trade of differences among regions within countries--what we call "lumpiness." If factors of production are sufficiently unevenly distributed across regions, then the pattern of trade of the country as a whole may depart from what it would have been had factors been evenly distributed. Thus lumpiness in the geographical distribution of factors can be a determinant of trade. We show in particular that if other determinants of trade are absent, then a country will tend to export the good that intensively uses its lumpier (i.e., more unevenly distributed) factor.

DOI:10.1086/261813 (Full Text)

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