Research seminar with Andre Seidel, (TU Dresden): International Trade, Geographic Heterogeneity and Interregional Inequality
Welcome to our research seminar with Andre Seidel from TU Dresden.
Title: International Trade, Geographic Heterogeneity and Interregional Inequality
We study the effect of international trade on interregional inequality within countries from 1992-2012 for almost all countries of the world. Following theoretical predictions of (new) economic geography, we consider that the effect of trade on inequalities depends on heterogeneities in international and interregional trade costs within countries. To do so we develop novel indicators for within-country trade cost heterogeneities. Instrumental variable regressions reveal that international trade increases interregional inequality only in those countries that have a higher within-country heterogeneity in the access to the world market and within-country trade costs.