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A Theory of Just-in-Time and the Growth in Manufacturing Trade

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  • Dalton, John

Abstract

This paper argues the widespread adoption of Just-in-Time (JIT) logistics provides a key to understanding the growth in the U.S. trade share. To do so, I develop a dynamic trade model based on the choice of the logistics technology used in a firm's supply chain. The model's predicted trade dynamics depend on how the set of firms using JIT with international suppliers changes over time. A numerical example shows the model is capable of generating growth in the trade share. I present evidence showing the theory is consistent with aggregate data as well as industry-level panel data.

Suggested Citation

  • Dalton, John, 2013. "A Theory of Just-in-Time and the Growth in Manufacturing Trade," MPRA Paper 48223, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:48223
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    File URL: https://mpra.ub.uni-muenchen.de/48223/1/MPRA_paper_48223.pdf
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    References listed on IDEAS

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    Cited by:

    1. Zhe Chen & Yoshinori Kurokawa, 2023. "The Value Added-Exports Puzzle and Global Value Chains," Tsukuba Economics Working Papers 2023-001, Faculty of Humanities and Social Sciences, University of Tsukuba.

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    More about this item

    Keywords

    trade growth; Just-in-Time; newsvendor problem; airplane transportation;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management

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