Resource title

Trade costs, market access and economic geography : why the empirical specification of trade costs matters

Resource image

image for OpenScout resource :: Trade costs, market access and economic geography : why the empirical specification of trade costs matters

Resource description

Trade costs are a crucial in new economic geography (NEG) models. The unavailability of actual trade costs data requires the approximation of trade costs. Most NEG studies do not deal with the ramifications of the particular trade costs specification used. This paper shows that the specification of trade costs matters. Estimations of a NEG wage equation for a sample of 80 countries show how the relevance of the key NEG variable, market access, depends upon the trade costs specification. Our conclusion is that NEG needs to (re-)examine the sensitivity of its empirical findings to the handling of trade costs.

Resource author

E. Maarten Bosker, Harry Garretsen

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/26116

Resource license

Adapt according to the presented license agreement and reference the original author.