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GTAP Resource #2781

"Factor Content of Bilateral Trade: The Role of Firm Heterogeneity and Transaction Costs"
by Kancs, d'Artis and Pavel Ciaian

In this paper we study the determinants of the factor content of the CEE agricultural trade. Examining empirically three hypothesis, which relate cross-country differences in technology, relative factor abundance and transaction costs and market imperfections to the factor content of trade we find that the first two hypotheses are confirmed by the majority of developed EU countries, but rejected by roughly one half of the CEE transition country pairs. Second, we find that when accounting for transaction costs of farm (re)organisation, both hypotheses are confirmed by the majority of the CEE country pairs. These findings provide empirical evidence of market imperfections, and particularly, of transaction costs of farm (re)organisation in the CEE.

Resource Details (Export Citation) GTAP Keywords
Category: GTAP Application
2008 Conference Paper
Status: Published
By/In: Presented at the 11th Annual Conference on Global Economic Analysis, Helsinki, Finland
Date: 2008
Version: 2.0
Created: Kancs, D. (4/15/2008)
Updated: Kancs, D. (9/15/2009)
Visits: 1,793
- Domestic policy analysis
- Economic development
- Labor market issues
- The GTAP Data Base and extensions
- Europe (Eastern)

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