The Heckscher-Ohlin model and the network structure of international trade

Thushyanthan Baskaran, Florian Blöchl, Tilman Brück and Fabian J. Theis

International Review of Economics & Finance, 2011, vol. 20, issue 2, 135-145

Abstract: This paper estimates for 28 product groups a characteristic parameter that reflects the topological structure of its trading network. Using these estimates, it describes how the structure of international trade has evolved during the 1980-2000 period. Thereafter, it demonstrates the importance of networks in international trade by explicitly accounting for their scaling properties when testing the prediction of the "Heckscher-Ohlin" model that factor endowment differentials determine bilateral trade flows. The results suggest that factor endowment differentials increase bilateral trade in goods that are traded in "dispersed" networks. For goods traded in "concentrated" networks, factor endowment differentials are less important.

Keywords: Networks; International; trade; Gravity; model (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (11)

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Working Paper: The Heckscher-Ohlin Model and the Network Structure of International Trade (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:20:y:2011:i:2:p:135-145

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