We carry out an indirect inference test of two versions of a computable general equilibrium (CGE) model of world trade …. One of these, the 'classical' model,is well-known as the Heckscher-Ohlin-Samuelson model of world trade, in which … countries trade homogeneous products in world markets and produce according to their comparative advantage as determined by …

equilibrium in export taxes is always higher than welfare under free trade for both countries. …

in Ethier (1982). With external economies, the larger country always gains from trade but the smaller country may lose … from trade unless the external economies of scale are sufficiently strong. The smaller country will always gain from … countries gain from complete economic integration (free labour migration with free trade). Finally, the optimal migration …

We set up two rival Computable General Equilibrium (CGE) models of world trade, one based on classical theories of … trade facts for five major countries or country blocs: the UK, the US, China and the EU. The UK is a small enough economy …

shown that there are losses from trade when the trade cost is close to the prohibitive level. Although the total number of … varieties increases, there is a reduction in consumer surplus. This occurs because trade leads to an increase in imported … varieties where consumer surplus is low due to the high trade cost and a decrease in domestically-produced varieties where …

We examine the empirical evidence bearing on whether UK trade is governed by a Classical model or by a Gravity model … Gravity model here differs from the Classical model in assuming imperfect competition and a positive effect of total trade on …