Trade, Growth, And Technology Equalization
- Topics:
- Organization
- Tags:
- Business Operations,
- Finance,
- Growth,
- Growth Rate,
- North Carolina State University,
- Operational Accounting,
- Research & Development
- Source:
- North Carolina State University
FREE Registration is required
Overview: Trade is shown to increase economic growth purely through comparative advantage without recourse to scale effects, technology transfer, research and development, or even international investment. The resulting growth rates are those that would result from technology transfer, even though no technology transfer actually occurs. A balanced growth rate exists, is identical for all countries and therefore the world, and is asymptotically stable if and only if each country has an absolute (not just comparative) advantage in something. When balanced growth does not exist, trade reduces but does not eliminate differences between countries' growth rates. Trade therefore does not necessarily guarantee a stable world income distribution. The magnitude of trade's effect on growth depends on the goods imported, not those exported.
(Is this item miscategorized? Does it need more tags? Let us know.)
Format: PDF | Size: 261KB | Date: Feb 2003 | Pages: 38
