Abstract
This study examines the marginal intra-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 have similar demand. Our results also confirm the hypothesis that trade increases if the transportation costs decrease. Key words: Marginal horizontal and vertical intra-industry trade, panel data.
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