TY  - RPRT
        AU  - Batista, Catia
AU  - Potin, Jacques
        TI  - Stages of Diversification in a Neoclassical World
        PY  - 2013/Nov/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 7765
        UR  - https://www.iza.org/publications/dp7765
        AB  - Recent research has documented a U-shaped industrial concentration curve over an economy's development path. How far can neoclassical trade theory take us in explaining this pattern? We estimate the production side of the Heckscher-Ohlin model using industry data on 44 developed and developing countries for the period 1976-2000. Decomposing the implied changes in industrial concentration over time shows that at least one third of these changes seems to be explained by a Rybczynski effect. This result suggests that capital accumulation led poor countries to diversify their industrial production, while rich countries made their production more concentrated in highly capital-intensive industries.
        KW  - specialization
KW  - diversification
KW  - Heckscher-Ohlin
KW  - economic growth and international trade
KW  - industrial concentration
KW  - structural change
        ER  -