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N° 2005-10 |
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| July 2005 |
| Disentangling Horizontal and Vertical
Intra-Industry Trade |
Lionel Fontagné
Michael Freudenberg
Guillaume Gaulier |
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| Intra-Industry Trade has been repeatedly
attested since the 1960s and justified on the grounds of the new approaches to
international trade based on imperfect competition and differentiated products.
Up to now however, scholars were relying on partial assessments of this phenomenon.
We provide here a systematic decomposition of world trade using harmonised bilateral
flows for some 5,000 products, into three trade types: inter-industry, intra-industry
in horizontally versus vertically differentiated products, over the period 1989-2002.
We show that the increase in IIT at the world level is due to two-way trade of
vertically differentiated products. However inter-industry trade has recently
recovered, due to the increasing participation of emerging economies in world
trade. |
Abstract |
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| Intra-Industry Trade; International Trade |
Keywords |
| F14; F15 |
JEL classification |
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