Sim, N.2011-09-052011-09-052005Applied Economics Letters, 2005; 12(3):161-1631350-48511466-4291http://hdl.handle.net/2440/65881This paper presents a simple two-sector two-factor model with endogenously determined industrial composition. It is shown that by shrinking the cone of diversification, service liberalization may enable the economy to switch from equilibrium where both traditional and modern goods are produced to another where specialization in the modern good takes place.en© 2005 Taylor & Francis Group Ltd.Journal article002011136410.1080/13504850420003236772-s2.0-1484434414828349