1347-0159

AA11577672

4305

Unrefereed

Following Takayama and Judge (1964a, 1964b), spatial equilibrium model has been used to find equilibrium situation effected as a necessary consequence of interactions among spatially (temporary or in transaction cost respect) separated persons such as producers, traders and consumers under some fixed market system including international trade, and the model has been applied to various empirical policy analyses. Kawaguchi(2003) demonstrate that we need to introduce more concrete marketing route and economic risk into spatial equilibrium model to get more wide area of model application. In this paper, we revise the spatial equilibrium model of international trade of Shono and Kawaguchi (1999a, 1999b, 2000) by changing the traditional marketing route "producers-consumers" to more concrete marketing route "producers as price-takers-profit marketing traders-consumers", and compare the equilibrium solutions of the oroginal model with that of revised models, solving five coutries international trade example problems. Profit making traders in revised models are assumed to behave as price-takers or to behave according to Nash rule, corresponding to the behavior patterns of producers in original models. The conclusion of the comparision is as follows. By changing the marketing route, 1)supply quantity decrease, 2) price received by producers decrease, 3) market proce increase, 4) and so the difference between market price and price received by producers increase, giving considerable profit to traders. This shows the importance of considering concrete marketing route in spatial equilibrium model of this paper is left open for future.

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