Globalization Upends North-North Trade Dynamics, Reshaping Economic Landscapes
Trade between countries in the North is influenced by their different resources, contrary to previous beliefs. Intra-industry trade within the North actually plays a significant role in this. The study found that trade in factor services among Northern countries is linked to their resource differences and is economically important. This challenges the idea that North-North trade is solely driven by economies of scale and product differentiation.