Munich Personal RePEc Archive

Network Externalities and Comparative Advantage

Kikuchi, Toru (2007): Network Externalities and Comparative Advantage. Forthcoming in: Bulletin of Economic Research

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Abstract

In this article I examine how the network externalities of communications activities and trading opportunities interact to determine the structure of comparative advantage. These interactions are examined by constructing a two-country, three-sector model of trade involving a country-specific communications network sector. The role of the connectivity of network providers, which allows users of a network to communicate with users of another network, is also explored.

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