Abstract:This article analyses the economic advantages of intra-industry trade in both a final good and the connected intermediate good. In comparison with a situation of autarky, this type of trade brings about an increase in the total number of intermediate good varieties and thereby a reduction in the number of adaptations of intermediate goods to the production process.In this way, the producers of final goods will benefit from varieties of intermediate goods that are closer to the ideal for a specific production p… Show more
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