Commodity Trade Matters
Thibault Fally, James Sayre
Primary commodities are used as inputs into all production processes, yet they account for approximately 16 percent of world trade. Despite their share in trade, we show that the aggregate gains from trade are largely understated if we ignore key features of commodities: low price elasticities of demand (difficulty in finding substitutes), low price elasticities of supply, and high dispersion of natural resources across countries. We develop a general-equilibrium model of consumption, production, and input-output linkages that explicitly accounts for these features. Our simulations confirm that the gains from trade are significantly larger, especially when considering large trade cost changes
Year of publication: |
August 2018
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Authors: | Fally, Thibault |
Other Persons: | Sayre, James (contributor) |
Institutions: | National Bureau of Economic Research (contributor) |
Publisher: |
2018: Cambridge, Mass : National Bureau of Economic Research |
Subject: | Außenwirtschaftstheorie | International economics | Rohstoff | Raw materials | Außenhandelselastizität | Trade elasticity | Allgemeines Gleichgewicht | General equilibrium | Außenhandelsgewinn | Gains from trade |
Saved in:
freely available
Extent: | 1 Online-Ressource illustrations (black and white) |
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Series: | NBER working paper series ; no. w24965 |
Type of publication: | Book / Working Paper |
Language: | English |
Notes: | System requirements: Adobe [Acrobat] Reader required for PDF files Mode of access: World Wide Web Hardcopy version available to institutional subscribers |
Other identifiers: | 10.3386/w24965 [DOI] |
Source: | ECONIS - Online Catalogue of the ZBW |
Persistent link: https://www.econbiz.de/10012480618