Sobre comercio interregional e internacional

Paul Krugman y Ryan Avent

"Interregional trade is not Ricardian. It is instead rooted in increasing returns and the sort of intra-industry trade that was explained by Mr Krugman's new trade theory.

Rapid trade growth over the past generation ("hyperglobalisation") is a different story, however. That trade has been associated with the incorporation in the global market of very large emerging economies that do have profoundly different factor endowments from rich-world economies: most notably in their relative abundance of cheap labour.

 ...

 Return to the example of the iPhone. Design and engineering work and the production of critical components operate in an increasing returns world. Assembly, by contrast, seems to be governed by comparative advantage.

 But that's still a somewhat dissatisfying narrative. The question is: why should assembly be driven by factor abundance while design is not? It's obviously not because emerging markets can't produce sufficiently talented engineers; they do, and quite often those engineers go to Silicon Valley to work.

 Mr Krugman has wrestled with these dynamics as well. Increasing returns can also generate geographic concentration. In the presence of certain positive externalities, productivity spillovers or complementarities or what have you, firms in one geographic area grow more productive as the area itself grows larger: more firms, higher productivity, more firms. So in one sense, increasing-returns-driven trade is what you get when the productivity benefits of local spillovers outweigh the potential gains from taking advantage of factor-price gaps. As the spillover benefits to bits of a supply chain erode (either because falling transport cost enable one to reap such benefits at greater distance, or because technology maturation means there is less of the tinkering and experimentation that seems to work best in clusters) those bits escape the pull of metropolitan gravity and fall toward places where the factors the bits rely on are cheapest."