Dasgupta, Sudipto; Ray, Tridip; Wong, Kit Pong - In: Canadian Journal of Economics 35 (2002) 4, pp. 757-785
When firms in the same industry located in different regions or countries experience shocks to production costs in their respective industries that are imperfectly correlated, arbitrage opportunities automatically lead to trade. Trade can either stabilize or destabilize the price faced by...