Border effects and the availability of domestic products abroad

Carolyn L. Evans

39 citations0/0 files storedCanadian Journal of Economics/Revue canadienne d économique

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Global trade and economics Canadian Policy and Governance Economic and Technological Innovation

Abstract

Abstract. Trade between countries could fall short of trade within a country because (1) the volume of international trade is less than the volume of domestic trade for a given product (the intensive margin); or (2) some goods that are sold domestically are simply not exported (the extensive margin). My theoretical model illustrates that either of these two factors could explain a given aggregate ‘border effect.’ I examine the empirical relevance of this distinction by isolating the fraction of total domestic production attributable only to exporters, finding that around one‐half of the border effect may be attributed to each explanation. JEL classification: F1

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References

2003Gravity with Gravitas: A Solution to the Border Puzzle 1995National Borders Matter: Canada-U.S. Regional Trade Patterns.n.d.The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs.1995Exporters, Jobs, and Wages in U.S. Manufacturing: 1976-1987 1994New goods, old theory, and the welfare costs of trade restrictions 1996Intra-National versus International Trade: How Stubborn are Nations in Global Integration?2000National borders and international trade: evidence from the European Union 2003The Economic Significance of National Border Effects

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