Theory of Comparative Advantage: Do Transportation Costs Matter?

Jacek Cukrowski · Manfréd M. Fischer

27 citations0/0 files storedJournal of Regional Science

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Global trade and economics Regional Economics and Spatial Analysis Global Trade and Competitiveness

Abstract

In this paper we present a formal analysis that incorporates returns to transportation into a Ricardian framework to predict trade patterns. The important point gained from this analysis is that increasing returns to transportation, coupled with appropriate distances between trading partners, can be shown to reverse Ricardian predictions even when there are no international differences in tastes, technology, or factor endowments. Additional gains from trade may emerge from reductions in aggregate delivery costs owing to scale economies.

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2014On the Principles of Political Economy, and Taxation 1973The Principles of Political Economy and Taxation.1981Intra-industry trade in identical commodities 1954The Transfer Problem and Transport Costs, II: Analysis of Effects of Trade Impediments 1977Bilateral Trade Flows and Transport Costs 1954Location Theory and International and Interregional Trade Theory 1976Effective Protection by Transportation Costs and Tariffs: A Comparison of Magnitudes

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