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North-South Models of Growth and Trade

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Author Info
Chui, Michael, et al

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Abstract

The paper surveys the literature that combines growth and trade into models of North-South interaction. We distinguish two strands of growth theory: old (exogenous) and new (endogenous) growth. We also distinguish old trade theory which assumes constant returns to scale and perfect competition, and new trade theory which relaxes both of these assumptions. This gives us four possible combinations of growth and trade theories which provide the basis of the taxonomy employed in our survey. We address the following long-standing issues raised in the literature: first, given that one of the North-South asymmetries is that the North leads in technical progress, how does the South adjust to such changes? Second, can the models explain patterns of trade and income differentials between the regions? Third, do asymmetries mean that standard prescriptions on the mutual benefits of free trade and free movements of capital need to be modified? Finally, can our models explain why the South continues to favour protection of its manufacturing sectors at the same time that barriers within the North are being dismantled? Copyright 2002 by Blackwell Publishers Ltd

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Publisher Info
Article provided by Blackwell Publishing in its journal Journal of Economic Surveys.

Volume (Year): 16 (2002)
Issue (Month): 2 (April)
Pages: 123-65
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Handle: RePEc:bla:jecsur:v:16:y:2002:i:2:p:123-65

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  1. Montobbio Fabio & Rampa Francesco, 2002. "The impact of technology and structural change on export performance on nine developing coutries," Economics and Quantitative Methods qf0219, Department of Economics, University of Insubria. [Downloadable!]
    Other versions:
  2. Dinopoulos, Elias & Segerstrom, Paul, 2006. "North-South Trade and Economic Growth," CEPR Discussion Papers 5887, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  3. Ugo Fratesi, 2003. "Innovation Diffusion and the Evolution of Regional Disparities," ERSA conference papers ersa03p327, European Regional Science Association. [Downloadable!]
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  4. Ugo Fratesi, 2004. "Regional policy from a supra-regional perspective," ERSA conference papers ersa04p509, European Regional Science Association. [Downloadable!]
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  5. Andre Varella Mollick & Joao Ricardo Faria & Pedro H. Albuquerque & Miguel A. Leon-Ledesma, 2005. "Can Globalisation Stop the Decline in Commodities' Terms of Trade? The Prebisch-Singer Hypothesis Revisited"," Studies in Economics 0510, Department of Economics, University of Kent. [Downloadable!]
  6. Zon, Adriaan van & Schmidt, Tobias, 2008. "To Be or Not to Be at the BOP: A One-North-Many-Souths Model with Subsistence and Luxury Goods," UNU-MERIT Working Paper Series 046, United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology. [Downloadable!]
  7. Ginchev Ivan & Guerraggio Angelo & Rocca Matteo, 2002. "On second-order conditions in vector optimization," Economics and Quantitative Methods qf0218, Department of Economics, University of Insubria. [Downloadable!]
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