Ricardian model and structure of Irish trade

Abstract

In a recent article J. McGilvray and D. Simpson (1973) examined the commodity structure of trade between the Irish Republic and the United Kingdom in the light of international trade theory. Their investigation was partly concerned with the role of the Ricardian model which they conclude appears to have little relevance for Anglo-Irish trade. It is argued here that though the methods of previous investigators have in general been followed, (as, for example, in the study by MacDougall (1951) of British and American exports) in one important respect this is not so. In consequence, the validity of McGilvray and Simpson's test is seriously open to doubt. The calculations are reworked in the light of this criticism and it is then seen that the pattern of trade between Britain and Ireland is fairly consistent with the Ricardian theory.