The paper presents a theory of the industrial transformation amongst sectors using endogenous growth theory. Allowing only a slight upward trend in the productivity of the human capital sector, combined with ascending degrees of human capital shares of sectoral output, in say, agriculture,...

Conditions for the occurrence of immiserizing growth and the Metzler paradox are analysed in the Ricardian model when consumers in the foreign country have Leontief preferences while consumers in the home country have Cobb-Douglas preferences. By using specific functional forms, the conditions...

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...

Using perfectly competitive, general equilibrium models of international trade, specific import tariffs, specific export taxes, and ad valorem trade taxes are compared in a trade war. A trade war is modelled as a NE in trade policies, where each country can choose to use ad valorem trade taxes...

The outcome of a trade war (with import tariffs and export subsidies) between two countries is analysed in a Cournot duopoly and in a Bertrand duopoly with differentiated products. The model allows for asymmetries between the countries in terms of competitiveness. When the two countries are...

Welfare with the maximum-revenue tariff is compared to free-trade welfare under perfect competition in the case of a large country able to affect its terms of trade; under Cournot duopoly with differentiated products; and under Bertrand duopoly with differentiated products. Under perfect...

We examine the empirical evidence bearing on whether UK trade is governed by a Classical model or by a Gravity model, using annual data from 1965 to 2015 and the method of Indirect Inference which has very large power in this application. The Gravity model here differs from the Classical model...

We set up two rival Computable General Equilibrium (CGE) models of world trade, one based on classical theories of comparative advantage, the other based on recent gravity theories. We have tested them by indirect inference on the time-series of trade facts for five major countries or country...