▁minim ize ▁transport ation ▁costs . ▁ ▁The ▁home ▁market ▁effect ▁implies ▁a ▁link ▁between ▁market ▁size ▁and ▁exports ▁that ▁is ▁not ▁account ed ▁for ▁in ▁trade ▁models ▁based ▁sole ly ▁on ▁compar ative ▁advantage . ▁ ▁The ▁home ▁market ▁effect ▁first ▁proposed ▁by ▁C orden ▁and ▁was ▁developed ▁by ▁Paul ▁K rug man ▁in ▁a ▁ 1 9 8 0 ▁article . ▁K rug man ▁sought ▁to ▁provide ▁an ▁alternative ▁to ▁the ▁L inder ▁hypothesis . ▁Based ▁on ▁recent ▁research , ▁the ▁home ▁market ▁effect ▁confir ms ▁L inder ' s ▁sentiment ▁that ▁a ▁nation ' s ▁demand ▁is ▁a ▁predicate ▁for ▁its ▁exports , ▁but ▁does ▁not ▁support ▁L inder ' s ▁claim ▁that ▁differences ▁in ▁countries ' ▁prefer ences ▁imp ede ▁trade . ▁ ▁K rug man ' s ▁model ▁yields ▁two ▁related ▁predictions ▁regarding ▁the ▁effects ▁of ▁market ▁size ▁asym met ries ▁on ▁the ▁ge ographic ▁distribution ▁of ▁industry ▁activity . ▁K rug man ▁( 1 9 8 0 ) ▁demonstr ates ▁that ▁a ▁country ▁with ▁larger ▁consum ers ▁of ▁an ▁industry ' s ▁goods ▁will ▁run ▁a ▁trade ▁sur plus ▁in ▁that ▁industry ▁character ized ▁by ▁econom ies ▁of ▁scale . ▁Help man ▁and ▁K rug man ▁( 1 9 8 5 ) ▁show ▁that ▁the ▁larger ▁country ' s ▁share ▁of ▁fir ms ▁in ▁that ▁increasing ▁returns ▁industry ▁exceed ▁its ▁share ▁of ▁consum ers . ▁Thus , ▁a ▁further ▁development ▁in ▁the ▁literature ▁has ▁been ▁to ▁examine ▁the ▁robust ness ▁of ▁the ▁home ▁market ▁effects ▁( H