1 Network Externalities, Competition, and Trade: East Asian Perspectives

There are large deviations in access to telecommunications infrastructure and trading patterns within the East Asian region. We examine how the network externalities of communication activities and trading opportunities interact to determine the structure of comparative advantage. These interactions are examined by constructing a simple two-country, two-good model of trade involving a country-specific communications network sector. The role of competition of network service providers, which allows users of a network easier access to other networks, is also explored. (JEL Classification: D43, F12, L13