The Home Market Shadow

Südekum, Jens

The Home Market Shadow

Files

HeterogeneArbeit_0501.pdf(193.05 KB)

Date

2005

Authors

Südekum, Jens

Series

Diskussionspapiere der DFG-Forschergruppe Heterogene Arbeit; 05/01

Publication type

Working Paper/Technical Report

Abstract

The home market effect (HME) is a distinguishing feature of the new theory of international trade, but it is uncertain whether this effect survives if one moves beyond the simplifying setup with only two countries. We present a three-country version of the seminal model by Krugman (1980) and analyse under which circumstances the HME is present once third country effects are taken into account. We show that an exogenous increase in the home country s expenditure level on the modern good will unambiguously lead to an over-proportional output reaction. If production in the foreign world shifts from a more remote to a better accessible economy, industry location in the home country is negatively affected. Thus, if the expenditure increase is small relative to the foreign expenditure shifting, an under-proportional output reaction in the home country can result. In a more extreme case the industry share of the home country can even decrease. This phenomenon is labelled the home market shadow .

Subject (DDC)

330 Economics

Keywords

Neue Außenhandelstheorie,Binnenmarkt-Effekt,new trade theory,home market effect,hub effect

Cite This

ISO 690

SÜDEKUM, Jens, 2005. The Home Market Shadow

BibTex

@techreport{Sudekum2005Marke-11972,
  year={2005},
  series={Diskussionspapiere  der DFG-Forschergruppe Heterogene Arbeit},
  title={The Home Market Shadow},
  number={05/01},
  author={Südekum, Jens}
}

RDF

<rdf:RDF
    xmlns:dcterms="http://purl.org/dc/terms/"
    xmlns:dc="http://purl.org/dc/elements/1.1/"
    xmlns:rdf="http://www.w3.org/1999/02/22-rdf-syntax-ns#"
    xmlns:bibo="http://purl.org/ontology/bibo/"
    xmlns:dspace="http://digital-repositories.org/ontologies/dspace/0.1.0#"
    xmlns:foaf="http://xmlns.com/foaf/0.1/"
    xmlns:void="http://rdfs.org/ns/void#"
    xmlns:xsd="http://www.w3.org/2001/XMLSchema#" > 
  <rdf:Description rdf:about="https://kops.uni-konstanz.de/server/rdf/resource/123456789/11972">
    <void:sparqlEndpoint rdf:resource="http://localhost/fuseki/dspace/sparql"/>
    <dc:date rdf:datatype="http://www.w3.org/2001/XMLSchema#dateTime">2011-03-25T09:41:28Z</dc:date>
    <dcterms:isPartOf rdf:resource="https://kops.uni-konstanz.de/server/rdf/resource/123456789/46"/>
    <dcterms:abstract xml:lang="eng">The home market effect (HME) is a distinguishing feature of the  new  theory of international trade, but it is uncertain whether this effect survives if one moves beyond the simplifying setup with only two countries. We present a three-country version of the seminal model by Krugman (1980) and analyse under which circumstances the HME is present once third country effects are taken into account. We show that an exogenous increase in the home country s expenditure level on the modern good will unambiguously lead to an over-proportional output reaction. If production in the foreign world shifts from a more remote to a better accessible economy, industry location in the home country is negatively affected. Thus, if the expenditure increase is small relative to the foreign expenditure shifting, an under-proportional output reaction in the home country can result. In a more extreme case the industry share of the home country can even decrease. This phenomenon is labelled the  home market shadow .</dcterms:abstract>
    <dc:contributor>Südekum, Jens</dc:contributor>
    <dc:creator>Südekum, Jens</dc:creator>
    <dcterms:available rdf:datatype="http://www.w3.org/2001/XMLSchema#dateTime">2011-03-25T09:41:28Z</dcterms:available>
    <dc:format>application/pdf</dc:format>
    <dcterms:hasPart rdf:resource="https://kops.uni-konstanz.de/bitstream/123456789/11972/1/HeterogeneArbeit_0501.pdf"/>
    <dcterms:title>The Home Market Shadow</dcterms:title>
    <dspace:isPartOfCollection rdf:resource="https://kops.uni-konstanz.de/server/rdf/resource/123456789/46"/>
    <bibo:uri rdf:resource="http://kops.uni-konstanz.de/handle/123456789/11972"/>
    <dc:rights>terms-of-use</dc:rights>
    <dspace:hasBitstream rdf:resource="https://kops.uni-konstanz.de/bitstream/123456789/11972/1/HeterogeneArbeit_0501.pdf"/>
    <dc:language>eng</dc:language>
    <dcterms:rights rdf:resource="https://rightsstatements.org/page/InC/1.0/"/>
    <foaf:homepage rdf:resource="http://localhost:8080/"/>
    <dcterms:issued>2005</dcterms:issued>
  </rdf:Description>
</rdf:RDF>