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Technology Diffusion through Trade with Heterogeneous Firms

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  • Bulent Unel

Abstract

I investigate the long-run implications of trade and technology diffusion through trade, when firms are heterogeneous and trade is costly. This paper integrates firm heterogeneity and trade into a product innovation growth model from endogenous growth theory. I find that although exposure to trade increases average productivity, it has an ambiguous effect on economic growth and consumer welfare. Copyright � 2010 Blackwell Publishing Ltd.

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File URL: http://www.blackwell-synergy.com/links/doi/10.1111/j.1467-9396.2010.00880.x
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Bibliographic Info

Article provided by Wiley Blackwell in its journal Review of International Economics.

Volume (Year): 18 (2010)
Issue (Month): 3 (08)
Pages: 465-481

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Handle: RePEc:bla:reviec:v:18:y:2010:i:3:p:465-481

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0965-7576

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References

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  1. Roberts, Mark J & Tybout, James R, 1997. "The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs," American Economic Review, American Economic Association, vol. 87(4), pages 545-64, September.
  2. Mark J. Melitz, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," NBER Working Papers 8881, National Bureau of Economic Research, Inc.
  3. Andrew B. Bernard & J. Bradford Jensen, 1997. "Exceptional Exporter Performance: Cause, Effect, or Both?," NBER Working Papers 6272, National Bureau of Economic Research, Inc.
  4. Aghion, P. & Howitt, P., 1989. "A Model Of Growth Through Creative Destruction," UWO Department of Economics Working Papers 8904, University of Western Ontario, Department of Economics.
  5. Pavcnik, Nina, 2002. "Trade Liberalization, Exit, and Productivity Improvement: Evidence from Chilean Plants," Review of Economic Studies, Wiley Blackwell, vol. 69(1), pages 245-76, January.
  6. repec:rus:hseeco:121669 is not listed on IDEAS
  7. Grossman, Gene M. & Helpman, Elhanan, 1989. "Product Development and International Trade," Scholarly Articles 3445094, Harvard University Department of Economics.
  8. Paul M Romer, 1999. "Endogenous Technological Change," Levine's Working Paper Archive 2135, David K. Levine.
  9. repec:rus:hseeco:122439 is not listed on IDEAS
  10. Michelle P. Connolly & Diego Valderrama, 2005. "North-South technological diffusion and dynamic gains from trade," Working Paper Series 2004-24, Federal Reserve Bank of San Francisco.
  11. Rivera-Batiz, Luis A & Romer, Paul M, 1991. "Economic Integration and Endogenous Growth," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 531-55, May.
  12. Baldwin, Richard E. & Robert-Nicoud, Frederic, 2008. "Trade and growth with heterogeneous firms," Journal of International Economics, Elsevier, vol. 74(1), pages 21-34, January.
  13. Yeaple, Stephen & Helpman, Elhanan & Melitz, Marc, 2004. "Export versus FDI with Heterogeneous Firms," Scholarly Articles 3229098, Harvard University Department of Economics.
  14. Krugman, Paul, 1980. "Scale Economies, Product Differentiation, and the Pattern of Trade," American Economic Review, American Economic Association, vol. 70(5), pages 950-59, December.
  15. Aw, Bee Yan & Chung, Sukkyun & Roberts, Mark J, 2000. "Productivity and Turnover in the Export Market: Micro-level Evidence from the Republic of Korea and Taiwan (China)," World Bank Economic Review, World Bank Group, vol. 14(1), pages 65-90, January.
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Citations

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Cited by:
  1. Katsufumi Fukuda, 2013. "The Effect of Globalization in a Semi Endogenous Growth Model with Firm Heterogeneity, Endogenous International Spillover, and Trade," Discussion Paper Series DP2013-21, Research Institute for Economics & Business Administration, Kobe University.
  2. Bulent Unel & Elias Dinopoulos, . "A Simple Model of Quality Heterogeneity and International Trade," Departmental Working Papers 2009-04, Department of Economics, Louisiana State University.
  3. Richard E. Baldwin & Frédéric Robert-Nicoud, 2006. "Trade and Growth with Heterogeneous Firms," CEP Discussion Papers dp0727, Centre for Economic Performance, LSE.
  4. Naito, Takumi, 2012. "A Ricardian model of trade and growth with endogenous trade status," Journal of International Economics, Elsevier, vol. 87(1), pages 80-88.
  5. Patricia Hofmann, 2008. "Globalization and Technical Progress: Channels of Reciprocal Interaction A Literature Review," DEGIT Conference Papers c013_011, DEGIT, Dynamics, Economic Growth, and International Trade.
  6. Julian P. Christ & Patricia Hofmann, 2010. "International Openness and Patent Activity: First Descriptive Results Very preliminary draft," DEGIT Conference Papers c015_055, DEGIT, Dynamics, Economic Growth, and International Trade.
  7. katsufumi, fukuda, 2012. "Gains and Losses from International Trade in a Knowledge-driven Semi-endogenous Growth Model with Heterogeneous Firms," MPRA Paper 40818, University Library of Munich, Germany, revised 22 Aug 2012.
  8. Bulent Unel & Elias Dinopoulos, . "Quality Heterogeneity and Global Economic Growth," Departmental Working Papers 2009-06, Department of Economics, Louisiana State University.
  9. Frédéric Olland, 2012. "Asymmetries with R&D-Driven Growth and Heterogeneous Firms," Working Papers of BETA 2012-16, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.

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