The Asymmetric Effect of Endowments on Vertical Intra-Industrial Trade Milgram Baleix, Juliette Moro Egido, Ana Isabel Intra-industry trade Spain Quantile regression This research has been partially funded by projects SEJ340 and SEJ03261 of the Junta de Andalucia. Juliette Milgram gratefully acknowledges financial support from the MICINN projects ECO2008-05908 and ECO2008-04059 and Ana Isabel Moro-Egido from MICINN project SEJ2006-11067. This paper investigates the determinants of vertical Spanish intra-industry trade with developed and developing countries. We empirically test the comparative advantage explanation. To do so, we build physical, human and technological capital stocks. On average, when using OLS techniques, differences in endowments are a limitation for vertical intra-industry trade. Using quantile regression techniques, we observe that this negative effect decreases in absolute terms as vertical intra-industry trade flows increase and, in some cases, the impact becomes positive for the upper tails, thus supporting the view of a reduced version of the comparative advantage explanation. Our results provide interesting insights into Spain and emerging countries. A large part of Spanish trade already takes place on an inter-industry basis or consists of exporting low quality products in exchange for similar products of a higher quality range, in particular with European countries but more surprisingly with emerging countries. Our study shows that high quality exports and horizontal intra-industry trade are mainly driven by proximities of demand and technological capital while low quality exports share most determinants of inter-industry trade. 2024-07-15T09:40:20Z 2024-07-15T09:40:20Z 2010-05-13 journal article Milgram−Baleix, J. & Moro−Egido, A.I. (2010). The Asymmetric Effect of Endowments on Vertical Intra-Industrial Trade. World Economy, 33(5), pp. 746-777. DOI: 10.1111/j.1467-9701.2010.01238.x https://hdl.handle.net/10481/93120 10.1111/j.1467-9701.2010.01238.x eng open access Wiley Online Library