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The dynamics of economic integration: Theory and policy

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  • Lucas Bretschger
  • Thomas M. Steger

    ()

Abstract

Integration affects economic growth mainly through two different channels: The scale-effect channel and the factor-reallocation channel. In order to investigate both channels within a unifying framework, we employ a simple descriptive growth model. The scale-effect channel increases either the long-run growth rate or the level of the balanced growth path. The factor-reallocation channel is ambiguous. It is shown under which conditions this mechanism induces either a rise or a fall in the long-run growth rate. In addition, a number of policy conclusions are drawn. Copyright Springer-Verlag Berlin Heidelberg 2004

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Bibliographic Info

Article provided by Springer in its journal International Economics and Economic Policy.

Volume (Year): 1 (2004)
Issue (Month): 2 (January)
Pages: 119-134

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Handle: RePEc:kap:iecepo:v:1:y:2004:i:2:p:119-134

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Web page: http://www.springerlink.com/link.asp?id=111059

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Keywords: International trade; economic integration; economic growth; scale effects; factor reallocation; F1 (Trade); O4 (Economic Growth);

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Citations

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Cited by:
  1. Klaus Wälde & Christina Wood, 2004. "The empirics of trade and growth: where are the policy recommendations?," International Economics and Economic Policy, Springer, vol. 1(2), pages 275-292, January.
  2. Di Maria, Corrado & Valente, Simone, 2006. "The Direction of Technical Change in Capital-Resource Economies," MPRA Paper 1040, University Library of Munich, Germany.
  3. Valente, Simone, 2006. "Trade, Envy and Growth: International Status Seeking in a Two-Country World," MPRA Paper 1095, University Library of Munich, Germany.
  4. Grossmann, Volker & Steger, Thomas M., 2007. "Growth, Development, and Technological Change," IZA Discussion Papers 2558, Institute for the Study of Labor (IZA).
  5. Lutz Arnold, 2007. "A generalized multi-country endogenous growth model," International Economics and Economic Policy, Springer, vol. 4(1), pages 61-100, April.
  6. Simone Valente, 2006. "Intergenerational Transfers, Lifetime Welfare and Resource Preservation," CER-ETH Economics working paper series 06/55, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
  7. Moritz Schularick & Thomas Steger, 2006. "Does Financial Integration Spur EconomicGrowth? New Evidence from the First Era of Financial Globalization," CESifo Working Paper Series 1691, CESifo Group Munich.
  8. Tomasz Brodzicki, 2005. "New empirical insights into the growth effects of economic integration within EU," International Trade 0505014, EconWPA.
  9. Simone Valente, 2007. "International Status Seeking, Trade, and Growth Leadership," CER-ETH Economics working paper series 07/75, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
  10. Simone Valente, 2005. "Genuine Dissaving and Optimal Growth," Others 0505009, EconWPA.

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