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Chapter 3 in: Arndt, S. W., & Kierzkowski, H. (2001). Fragmentation: New production patterns in the world economy. Oxford: Oxford University Press.


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  • Our discussion in the present paper builds upon our two earlier analyses of international fragmentation (1990, 1998), focussing upon the importance of service links in connecting fragmented production blocks. The next section of this paper probes the fundamentals of the fragmentation process and how prices may adjust in global markets. The key role of services and the importance of increasing returns are highlighted in section 3. Section 4 explores in more detail possible causes of the increased degree of fragmentation now observed in world markets. A phenomenon of utmost interest in current policy debates is the effect of globalization on the distribution of income within a country, especially in the United States. Section 5 investigates the connection between fragmentation and wage rates for less skilled workers. The final section of the paper suggests various further consequences of the fragmentation phenomenon, especially as regards the changing nature of markets in the global economy.
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  • Jones, R.W. and H. Kierzkowski. A Framework For Fragmentation. In: Microbehavior and Macroresults:Proceedings of the Tenth Biennial Conference of the International Institute ofFisheries Economics and Trade, July 10-14, 2000, Corvallis, Oregon, USA.Compiled by Richard S. Johnston and Ann L. Shriver. InternationalInstitute of Fisheries Economics and Trade (IIFET), Corvallis, 2001.
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  • Shriver, Ann L.
  • Johnston, Richard S.
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  • International Institute of Fisheries Economics and Trade U.S. National Marine Fisheries Service MG Kailis Group
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