Trade Integration Costs and Industrial Concentration: A Theoretical Study from Economic Geography
ZHOU Xin-miao1,LI Yan2
1.Business School, Ningbo University, Ningbo 315211, China; 2.School of Economics and Management, Taiyuan University of Technology, Taiyuan 030012, China
Abstract This paper analyzes the effects of trade integration of two countries on industrial location and economic growth through a theoretical model. The conclusions reached finally depend both on whether the import or the export costs are affected by the trade policies on which the integration process is based and on whether the developed or the developing country introduces them. In general, when integration leads to an increase of industrial concentration in the developed country, the growth rate increases and welfare improves in both countries. If integration means that industry moves to the developing country, the growth rate decreases. In this case the developing country can also improve its welfare.
ZHOU Xin-Miao,LI Yan. Trade Integration Costs and Industrial Concentration: A Theoretical Study from Economic Geography. Economic Survey, 2013, 1(5): 072.
2013, Vol. 1 
