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Bubble Diagrams in Trade Theory

In: International Trade Theory and Competitive Models Features, Values, and Criticisms

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  • Ronald W. Jones

Abstract

“Bubble” diagrams are quite useful in revealing some of the properties found in the competitive models of international trade. These diagrams use circles (bubbles) to indicate commodity outputs and connecting lines to indicate factor inputs. Models such as the 2×2 and n×n Heckscher–Ohlin models as well as the 3×2 (and extensions) Specific-Factors model are discussed. For example, a model with some factor mobility between countries (say capital into a foreign enclave) is discussed for both model types. As well, close analogies are made to issues in labor economics in which both skilled and unskilled labor are used as inputs.

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  • Ronald W. Jones, 2018. "Bubble Diagrams in Trade Theory," World Scientific Book Chapters, in: International Trade Theory and Competitive Models Features, Values, and Criticisms, chapter 9, pages 137-152, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789813200678_0009
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    References listed on IDEAS

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    1. Kemp, Murray C & Wegge, Leon L F, 1969. "On the Relation between Commodity Prices and Factor Rewards," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 10(3), pages 407-413, October.
    2. Jones, Ronald W & Kierzkowski, Henryk, 1986. "Neighborhood Production Structures, with an Application to the Theory of International Trade," Oxford Economic Papers, Oxford University Press, vol. 38(1), pages 59-76, March.
    3. Ronald W. Jones, 2000. "Globalization and the Theory of Input Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 026210086x, December.
    4. Brati Sankar Chakraborty, 2009. "Protection And Real Rewards: Some Antinomies," Pacific Economic Review, Wiley Blackwell, vol. 14(1), pages 56-70, February.
    5. Ronald W. Jones & Sugata Marjit, 2003. "Economic Development, Trade and Wages," German Economic Review, Verein für Socialpolitik, vol. 4(1), pages 1-17, February.
    6. Chipman, John S, 1969. "Factor Price Equalization and the Stolper-Samuelson Theorem," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 10(3), pages 399-406, October.
    7. Ronald W. Jones, 2007. "Specific Factors And Heckscher-Ohlin: An Intertemporal Blend," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 52(01), pages 1-6.
    8. Jones, Ronald W & Dei, Fumio, 1983. "International Trade and Foreign Investment: A Simple Model," Economic Inquiry, Western Economic Association International, vol. 21(4), pages 449-464, October.
    9. Jones, Ronald W, 1989. "Co-movements in Relative Commodity Prices and International Capital Flows: A Simple Model," Economic Inquiry, Western Economic Association International, vol. 27(1), pages 131-141, January.
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    Cited by:

    1. Ronald W. Jones, 2018. "On Blending Competitive Trade Models," World Scientific Book Chapters, in: International Trade Theory and Competitive Models Features, Values, and Criticisms, chapter 19, pages 319-361, World Scientific Publishing Co. Pte. Ltd..

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    More about this item

    Keywords

    International Trade Theory; Models; Competitive Markets;
    All these keywords.

    JEL classification:

    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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