An Inframarginal Approach to Trade Theory

by Yang, Xiaokai; Cheng, Wenli; Shi, Heling; Tombazos, Chrtistis G.

• ISBN13: 9789812389299
• ISBN10: 9812389296
• Format: Hardcover
• Copyright: 2005-03-08
• Publisher: WORLD SCIENTIFIC PUB CO INC

Summary

Inframarginal analysis represents a methodology that extends marginal analysis, using non-classical mathematical programming, in efforts to investigate corner solutions and indivisibilities. As such this approach has been used to reintroduce classical insights regarding the division of labor and economic organization to the mainstream of economic inquiry. One of the most prolific and useful relevant applications of inframarginal analysis concerns the area of international trade theory. The ensuing field of study has attracted considerable -- and rapidly expanding -- interest in recent years. Yet, little has been done by way of organizing the accumulated knowledge in a single volume. This book fills that gap by collecting key articles that mark distinct stages in the evolution of research in the area of inframarginal applications to trade theory. In this context the volume represents an excellent introduction of this novel and exciting field of study to the new researcher, and an invaluable source of reference to those seasoned in inframarginal applications to trade theory.

Table of Contents

Part 1. Introduction
1. Divison of Labor and Corner Solutions in Positive Trade Theory	3	(16)
Christis G. Tombazos
Part 2. Origins of Inframarginal Applications to Trade Theory
2. Economics and Biology: Specialization and Speciation	19	(10)
Hendrik S. Houthakker
3. Substitution and Division of Labour	29	(24)
Sherwin Rosen
4. Trade and Insurance with Moral Hazard	53	(22)
Avinash Dixit
5. Trade and Insurance with Imperfectly Observed Outcomes	75	(12)
Avinash Dixit
Part 3. Exogenous Comparative Advantage: Corner Solutions in the Heckscher-Ohlin and Ricardian Models of Trade
6. An Inframarginal Analysis of the Ricardian Model	87	(22)
Wen Li Cheng, Jeffrey Sachs and Xiaokai Yang
7. A Ricardian Model with Endogenous Comparative Advantage and Endogenous Trade Policy Regimes	109	(22)
Wen Li Cheng, Meng-Chun Liu and Xiaokai Yang
8. A General-Equilibrium Re-Appraisal of the Stolper-Samuelson Theorem	131	(22)
Wen Li Cheng, Jeffrey Sachs and Xiaokai Yang
Part 4. Division of Labor in Models of Trade with Economies of Scale
9. A Ricardo Model with Economies of Scale	153	(32)
Ralph E. Gomory
10. Pattern of Trade and Economic Development in a Model of Monopolistic Competition	185	(38)
Jeffrey Sachs, Xiaokai Yang and Dingsheng Zhang
11. Market Led Industrialization and Globalization	223	(26)
Jeffrey Sachs and Xiaokai Yang
Part 5. Economies of Specialization and Endogenous Comparative Advantage
12. Specialization and Product Diversity	249	(12)
Xiaokai Yang and He-Ling Shi
13. Endogenous vs. Exogenous Comparative Advantage and Economies of Specialization vs. Economies of Scale	261	(30)
Xiaokai Yang
14. A New Theory of Demand and Supply and Emergence of International Trade from Domestic Trade	291	(34)
Xiaokai Yang
15. Walrasian Equilibrium Computation, Network Formation, and the Wen Theorem	325	(24)
Shuntian Yao
Part 6. Inframarginal Analysis of Trade Policy, Dual Structures, and Globalization
16. Globalization, Dual Economy, and Economic Development	349	(34)
Jeffrey Sachs, Xiaokai Yang and Dingsheng Zhang
17. Endogenous Structure of the Division of Labor, Endogenous Trade Policy Regime, and a Dual Structure in Economic Development	383	(26)
Xiaokai Yang and Dingsheng Zhang
Part 7. Dynamic Inframarginal Analysis of Trade Models with Endogenous Comparative Advantage
18. A Microeconomic Mechanism for Economic Growth	409	(28)
Xiaokai Yang and Jeff Borland
19. Specialization and a New Approach to Economic Organization and Growth	437	(10)
Jeff Borland and Xiaokai Yang
20. Specialization, Information, and Growth: A Sequential Equilibrium Analysis	447	(28)
Yew-Kwang Ng and Xiaokai Yang
21. Evolution in Division of Labor and Macroeconomic Policies	475	(16)
Junxi Zhang
22. Division of Labor, Money and Economic Progress	491	(24)
Wen Li Cheng
Index	515