The analysis is developed in the context of the "housemates problem," in which the rent for a house (the bad) must be apportioned among several housemates, each of whom is entitled to receive one room (the good). Each housemate is assumed to have the same endowment, so the auction of rooms is a...

This paper shows that there are gains from trade that a country can capture from a partly developed trading partner that strongly exceed the gains it can obtain by trading with a fully developed one. We will also show that these gains are beneficial to one country only, they always come at the...