This study analyzes the impact of international trade on the diffusion of flexible manufacturing in a general equilibrium framework. Suppliers produce a flexible base product that can be adapted to the specific input requirements of a continuum of downstream industries. The vertical structure is...

The relationship between market integration and the degree of specialization plays a key role in many areas of economics. In contrast to previous studies, we illustrate that globalization does not necessarily lead to specialization. The analysis is conducted in an extended Dixit-Stiglitz- Ethier...