Intra-industry trade between the United States and Canada

In this thesis, US-Canada trade patterns were analyzed and the determinants of US-Canada Intra-Industry Trade (IIT) were empirically tested. IIT is explained using the new trade theories, including the Neo-factor Proportions Model and Monopolistic Competition Model under General Trade Equilibrium (instead of the Functional Hypotheses).; The following three hypotheses that are empirically tested in this paper. The level of IIT is expected to be relatively high in industries: (1) with high levels of product differentiation, which is tested by the following proxies such as advertising expenses, value added and capital intensity; (2) typified by having economies of scale, which is tested by variable such as the average production cost; and (3) in which intense oligopolistic rivalry is common, where the oligopolistic rivalry is tested by proxy such as the world market share of US exports. Data were collected from the Organization of Economic Cooperation and Development (OECD) and the US Economic Census and proxies were developed to test each hypothesis. Three regression procedures were run. (Abstract shortened by UMI.)...