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Do regional Trade and Specialization drive intra-regional Risk-Sharing?
The goal of the present paper is two-fold. First, I explore the impact of di¤erent trade patterns on industrial specialisation and consequently on business cycle co-movements between and within di¤erent regions. Es- pecially, I emphasize industrial specialisation as a result of intra- or inter-...
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| Pubblicato in: | MAGKS - Joint Discussion Paper Series in Economics (Band 13-2008) |
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| Autore principale: | |
| Natura: | Arbeit |
| Lingua: | inglese |
| Pubblicazione: |
Philipps-Universität Marburg
2008
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| Soggetti: | |
| Accesso online: | PDF Full Text |
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| Riassunto: | The goal of the present paper is two-fold. First, I explore the impact
of di¤erent trade patterns on industrial specialisation and consequently
on business cycle co-movements between and within di¤erent regions. Es-
pecially, I emphasize industrial specialisation as a result of intra- or inter-
industry trade. Furthermore, I justify the predictions of di¤erent theo-
retical trade models on the basis of my results . Second, I analyse the
degree of risk-sharing between and within the regions in dependence of
the previous step. In particular, the purpose is to clarify direct and indi-
rect channels between trade, specialisation, business cycle co-movements
and risk sharing.
The expectations are that countries within a region with homogeneous
specialisations show intra-industry trade. Hence regional business-cycles
converge. Consequently, risk-sharing within these regions is not possible.
These countries tend to be more internationally …nancially integrated than
regionally. Inter-industry trade arises in countries within regions with
heterogeneous specialisation. As a result regional business-cycles diverge.
Now, countries can share risk within the region. Regional …nancial integra-
tion is stronger for these countries than international …nancial integration.
One further question is: do the same patterns create risk sharing also in
the means of consumption co-movements between or within a region? |
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| ISSN: | 1867-3678 |
| DOI: | 10.17192/es2023.0200 |