Recent theoretical models predict gains from international trade coming from intra-industry reallocations, due to a firm selection effect. In this paper we answer two related questions. First, what is the magnitude of this selection effect, and how does it compare to that of intra-national trade? Second, would the removal of ’behind-the-border’ trade frictions between integrated EU countries le...

To examine how changes in relative national prices affect trade flows, this study estimates the impact of industry-specific effective real exchange rates on industry-level balances, exports, and imports. We analyze variations intra-industry vertical specialization, which may both govern long-run relationship between flows. employ sample information from 13 manufacturing industries across five A...

U.S. foreign trade has grown much more rapidly than GDP in recent decades. But there is no consensus as to why. More than half of U.S. foreign merchandise trade consists of armslength and intra-firm trade by multinational corporations (MNCs). But prior empirical work on the growth of trade has not focused on the role of MNCs. To better understand the growth of trade, it is important to understa...

The paper analyses vertical intra-industry trade between EU and Accession countries, and concentrates on two country-specific determinants: Differences in personal income distribution and in technology. Both determinants have a strong link to national policies and to cross-border investment flows. In contrast to most other studies, income distribution is not seen as time-invariant variable, but...

In this paper the relationship between three types of trade specialization is analyzed for the period 1990 to 2000. For nine East-Asian countries and the United States the developments in international fragmentation, export specialization and intra-industry specialization are investigated. Asian countries, and specifically China, now play a larger role in international trade. The formation of p...