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Appraising the Options for International Trade in Services

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  • Jones, Ronald W
  • Ruane, Frances

Abstract

This paper considers an economy that has the option of opening up its service sector to international trade at either the factor or the product level. Assuming nonidentical technologies in the context of a competitive, specific-factors framework, the paper shows that opening up trade always results in welfare gains, but that the extent of the welfare gain, and consequential adjustments in output and income distribution, depend crucially on whether trade occurs at the product or the factor level. Both factor endowments and the degree of technological comparative advantage or disadvantage play a role in determining the preferred level for trade. Copyright 1990 by Royal Economic Society.

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  • Jones, Ronald W & Ruane, Frances, 1990. "Appraising the Options for International Trade in Services," Oxford Economic Papers, Oxford University Press, vol. 42(4), pages 672-687, October.
    • Handle: RePEc:oup:oxecpp:v:42:y:1990:i:4:p:672-87
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    Cited by:

    1. Ge, Qian-Qian & Liu, Xi-Hua & Zhang, Yu-Chen & Liu, Shi-Qi, 2023. "Has China’s Free Trade Zone policy promoted the upgrading of service industry structure?," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 1171-1186.
    2. Guerrieri, Paolo & Meliciani, Valentina, 2005. "Technology and international competitiveness: The interdependence between manufacturing and producer services," Structural Change and Economic Dynamics, Elsevier, vol. 16(4), pages 489-502, December.
    3. Riadh Ben Jelili, 2006. "Enjeux et problèmes du développement du tourisme dans les pays du Sud de la Méditerranée," Working Papers hal-03840594, HAL.
    4. Ngee Choon Chia & Whalley, John, 1997. "A numerical example showing globally welfare-worsening liberalization of international trade in banking services," Journal of Policy Modeling, Elsevier, vol. 19(2), pages 119-127, April.
    5. Bianka Dettmer, 2012. "Business services outsourcing and economic growth: Evidence from a dynamic panel data approach," Jena Economics Research Papers 2012-049, Friedrich-Schiller-University Jena.
    6. Mario Polese & Roger Verreault, 1989. "Trade in Information-Intensive Services: How and Why Regions Develop Export Advantages," Canadian Public Policy, University of Toronto Press, vol. 15(4), pages 376-386, December.
    7. Ahmad A. Al-Majali & Radi M. Adayleh, 2018. "International Competitiveness in Services in Some Middle East and North Africa Countries Using Gravity Model," International Review of Management and Marketing, Econjournals, vol. 8(2), pages 53-62.
    8. van Marrewijk, Charles & Stibora, Joachim & de Vaal, Albert & Viaene, Jean-Marie, 1997. "Producer services, comparative advantage, and international trade patterns," Journal of International Economics, Elsevier, vol. 42(1-2), pages 195-220, February.
    9. Cillian Ryan & Nicholas Horsewood, 2009. "The role of banks in financial integration: evidence from new EU members," International Economics and Economic Policy, Springer, vol. 6(3), pages 235-258, October.

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