IMF Working Paper Series
Выпуск N94/95 за 1994 год
Опубликовано на портале: 16-12-2003
Sayuri Shirai, Dongpei Huang
IMF Working Paper Series.
1994.
No. 94/95.
This paper provides a theoretical model to explain how industrialization affects
the structure of international trade. Using conventional economic concepts such as
economies of scale and monopolistic competition and considering both horizontal and
vertical product differentiation, the model explicitly focuses on industrialization
and its impact on the volume and share of intra- and inter-industry trade. The paper
considers two processes: one that increases the quality of manufactured products
and one that shifts labor from the agricultural to the manufacturing sector. The
model shows that the volume and share of intra-industry trade increase when the quality
of products in a developing country improves and when the difference in relative
factor endowments between an industrial and a developing country shrinks. It also
suggests that the faster a developing country industrializes, the faster intra-industry
trade increases.
This paper investigates empirically the structural changes in Japan's international
trade with Indonesia and Korea for 1975 and 1985. These countries were chosen because
they differ in their relative factor endowments and technology.

