General equilibrium analysis of the Eaton-Kortum model of international trade
By: Fernando Alvarez, Robert E. Lucas.
Contributors: Lucas, Robert E.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11764; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11764.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Eaton, Jonathan, 1950-; Kortum, Samuel.; International trade -- Mathematical models.; Tariff -- Mathematical models.; Balance of trade -- Mathematical models.
Description: "We study a variation of the Eaton-Kortum model, a competitive, constant-returns-to-scale multicountry Ricardian model of trade.  We establish existence and uniqueness of an equilibrium with balanced trade where each country imposes an import tariff.  We analyze the determinants of the cross-country distribution of trade volumes, such as size, tariffs and distance, and compare a calibrated version of the model with data for the largest 60 economies.  We use the calibrated model to estimate the gains of a world-wide trade elimination of tariffs, using the theory to explain the magnitude of the gains as well as the differential effect arising from cross-country differences in pre-liberalization of tariffs levels and country size"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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