Input substitutability, trade costs and location

Constant unit manufacturing costs are lower (higher) in high wage North when inputs are (i) tradeable, (ii) country-specific and (iii) the elasticity of substitution between them is below (above) one. A two-country model of firm entry/location is considered.

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Year of publication:	2012
Authors:	Michalski, Tomasz
Published in:	Economics Letters. - Elsevier, ISSN 0165-1765. - Vol. 117.2012, 1, p. 57-59
Publisher:	Elsevier
Subject:	Input substitutability \| Trade costs \| North–South trade \| Location

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Type of publication:	Article
Classification:	F12 - Models of Trade with Imperfect Competition and Scale Economies ; O14 - Industrialization; Manufacturing and Service Industries; Choice of Technology ; R30 - Real Estate Markets, Spatial Production Analysis, and Firm Location. General
Source:	RePEc - Research Papers in Economics

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