This paper derives bilateral trade from two cases of the Heckscher-Ohlin Model, both also representing a variety of other models as well. First is frictionless trade, in which the absence of all impediments to trade in homogeneous products causes producers and consumers to be indifferent among...

We develop a methodology to construct nonparametric counterfactual predictions, free of functional-form restrictions on preferences and technology, in neoclassical models of international trade. First, we establish the equivalence between such models and reduced exchange models in which...

The changes in globalization and in the world of international business make it necessary to rethink the basic model of the economics of international business. For most of the 2nd half of the 20th century international business was about how large companies in the developed countries increase...

A neoclassical growth model is used to provide an explanation for a "poverty trap," or "club convergence," in terms of specialization and international trade. The model has a large number of countries with access to identical constant-returns-to-scale technologies for producing and trading three...

1. Introduction for philosophers of science -- 2. On the cause of fruitless methodology (an introduction for economists) -- 3. Aims and set-up of this study -- A. Two central theses in the theory of international trade and their place in the economists’ world view -- A.1. The neoclassical...

This paper develops a new model with heterogeneous firms under perfect competition in a Heckscher-Ohlin-Samuelson setting. We show that trade need not make selection in the comparative advantage sector stricter as suggested by earlier work. Selection is driven by the capital intensity in entry...