This paper develops a general-equilibrium model which features the Home Market Effect and land use for production in the sector of increasing returns to scale. The land rent in the larger region is higher, meanwhile, the larger region holds more-than-proportionate share of firms, the so called...

This paper builds a simple three-country model with different market sizes and non-constant wages. We shed light on the evolution patterns of wages in middlesized countries in the process of trade liberalization. We analytically disclose that, while the wage inequality between the large and the...