US MARGINAL INTRA- INDUSTRY TRADE AND COUNTRY CHARACTERISTICS

This study examines the marginal infra-industry trade (MIIT) and its components horizontally and marginal vertical intra-industry trade (MVIIT) applied to the United States. We present an alternative methodology to evaluate marginal intra-industry trade (MIIT) which was presented by Thom and McDowell (1999) and Azhar and Elliot (2008). Using a panel data approach, the results. show a negative correlation between endowments and marginal intra-industry trade. These results indicate that marginal intra-industry trade occurs more frequently among countries that are similar demand. Our results also confirm the hypothesis that trade increases if the transportation costs decrease.