D. Greenaway et al., VERTICAL AND HORIZONTAL INTRAINDUSTRY TRADE - A CROSS INDUSTRY ANALYSIS FOR THE UNITED-KINGDOM, Economic journal, 105(433), 1995, pp. 1505-1518
A large theoretical literature has emerged directed at explaining the
presence of intra-industry trade (IIT). One of the distinctions which
comes out of these models is that between horizontal IIT (where goods
are differentiated by attributes) and vertical IIT (where goods are di
fferentiated by quality). In this paper horizontal and vertical IIT in
UK trade are disentangled using a unit value dispersion criterion and
a range of industry characteristics. The paper not only points up the
relative importance of vertical and horizontal IIT in the United King
dom, it also demonstrates how a failure to separate them out can impac
t on the interpretation of empirical results.