Ottaviano, Gianmarco I.P.; Behrens, Kristian; … - Fondazione ENI Enrico Mattei (FEEM) - 2009
The standard two-country model of international trade with monopolistic competition predicts a more-than-proportional relationship between a country’s share of world production of a good and its share of world demand for that same good, a result known as the “home market effect”. We first...