Vertical intra-industry trade accounts for a large share of trade between countries characterized by similar factor endowments. Moreover, it is observed even at a very disaggregated level of statistical classifications, suggesting that the traded products have similar factor intensities. This...

Vertical intra-industry trade (VIIT), i.e. trade in products that are differentiated by their quality, accounts for a very large share of total trade between similar countries. So far, the theoretical literature has identified one main determinant of this kind of trade, namely the difference in...

Vertical intra-industry trade (VIIT), i.e. trade in products that are differentiated by their quality, accounts for a very large share of total trade between similar countries. So far, the theoretical literature has identified one main determinant of this kind of trade, namely the difference in...

Adam Smith is commonly referred to as one of the first who thought of foreign trade in terms of an international division of labour, whereby each country specialises in the production of certain goods. It is argued that he made a strong case for foreign trade on this basis. In this article, I...

The Heckscher-Ohlin-Vanek (HOV) model in its strict form has been strongly rejected by the data. Relaxing some assumptions of the standard HOV model is key to find improvements in its performance. We apply Davis and Weinstein (2001) methodology to analyse the validity of the HOV model using...

In the paper we introduce technological comparative advantage and transaction costs into the Heckscher-Olin (HO) model and refine the HO theorem, the Stolper-Samuelson theorem, the Rybczynski theorem, and factor equalization theorem. The refined core theorems can be used to accommodate recent...

Results of previous studies on the correlation between exchange rate changes and trade balance are unpersuasive. The present endeavor tries to understand the direct ion of changes between trade balance and exchange rate and how the depreciation in exchange rate takes place by incorporating the...

W ostatnich latach coraz śmielej formułuje się hipotezę głoszącą, że światowym handlem na powrót rządzi klasycznie interpretowana przewaga komparatywna, co umniejsza znaczenie osiągnięć nowych ujęć teoretycznych i zarazem przywraca aktualność tradycyjnej teorii handlu...

This paper adapts the modern workhorse model of quantitative trade theory (Eaton and Kortum, 2002) as a measurement tool to quantify the magnitudes of Switzerland’s gains from trade. I find that the importance of single trading partners for Switzerland’s welfare is surprisingly small. The...