International Trade in Manufactured Products: A Ricardo-Heckscher-Ohlin Explanation with Monopolistic Competition

Choudhri, Ehsan U.; Hakura, Dalia

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International Trade in Manufactured Products: A Ricardo-Heckscher-Ohlin Explanation with Monopolistic Competition

IMF Working Paper No. 01/41

28 Pages Posted: 30 Jan 2006

See all articles by Ehsan U. Choudhri

Ehsan U. Choudhri

Carleton University - Department of Economics

Dalia Hakura

International Monetary Fund (IMF)

There are 2 versions of this paper

Date Written: April 2001

Abstract

A large data set on trade in manufactured products is used to evaluate the performance of a model that combines both the Ricardian and Heckscher-Ohlin effects and incorporates monopolistic competition. The paper estimates a relation implied by the model to explain relative sectoral exports of major countries to a number of important markets, using 1970-90 data for nine manufacturing sectors. The relation fits the data well and variables suggested by both traditional and new trade models play an important role in explaining relative exports.

Keywords: Ricardian and Heckscher-Ohlin models, monopolistic competition

JEL Classification: F11, F12

Suggested Citation: Suggested Citation

Choudhri, Ehsan U. and Hakura, Dalia, International Trade in Manufactured Products: A Ricardo-Heckscher-Ohlin Explanation with Monopolistic Competition (April 2001). IMF Working Paper No. 01/41, Available at SSRN: https://ssrn.com/abstract=879423