Technology, Geography, and Trade

2002/09/01 by Jonathan Eaton, Samuel Kortum · 11 citations
Economics, Econometrics and Finance · #Global trade and economics #Economic Growth and Productivity #Regional Economics and Spatial Analysis

paper · doi:10.1111/1468-0262.00352

openalex publication_date 2002/09/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/04

Abstract

We develop a Ricardian trade model that incorporates realistic geographic features into general equilibrium. It delivers simple structural equations for bilateral trade with parameters relating to absolute advantage, to comparative advantage (promoting trade), and to geographic barriers (resisting it). We estimate the parameters with data on bilateral trade in manufactures, prices, and geography from 19 OECD countries in 1990. We use the model to explore various issues such as the gains from trade, the role of trade in spreading the benefits of new technology, and the effects of tariff reduction. Copyright The Econometric Society 2002.

Citations

• Estimating Discrete-Choice Models of Product Differentiation
• International R&D spillovers

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