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Transportation Costs and the Great Divergence

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  • Leonid V. Azarnert

Abstract

This work shows the asymmetric effect of the reduction in transportation costs across different sectors in the process of the Great Divergence. Specifically, the analysis indicates that reductions in transportation costs of industrial goods enhance convergence of the growth rates of trading economies. In contrast, reductions in transportation costs of non-industrial goods contribute to a further divergence across countries.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2014/wp-cesifo-2014-04/cesifo1_wp4766.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4766.

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Date of creation: 2014
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Handle: RePEc:ces:ceswps:_4766

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Keywords: international trade; trade costs; transportation revolution; fertility; economic growth;

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  1. Oded Galor, 2010. "The Demographic Transition: Causes and Consequences," Working Papers 2010-12, Brown University, Department of Economics.
  2. World Bank, 2010. "World Development Indicators 2010," World Bank Publications, The World Bank, number 4373, August.
  3. Galor, Oded, 2005. "From Stagnation to Growth: Unified Growth Theory," Handbook of Economic Growth, Elsevier, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 4, pages 171-293 Elsevier.
  4. Ashraf, Quamrul & Galor, Oded & Özak, Ömer, 2009. "Isolation and Development," CEPR Discussion Papers, C.E.P.R. Discussion Papers 7531, C.E.P.R. Discussion Papers.
  5. Bond, Eric W. & Iwasa, Kazumichi & Nishimura, Kazuo, 2013. "Poverty Traps And Inferior Goods In A Dynamic Heckscher–Ohlin Model," Macroeconomic Dynamics, Cambridge University Press, Cambridge University Press, vol. 17(06), pages 1227-1251, September.
  6. Oded Galor & Andrew Mountford, 2006. "Trade and the Great Divergence: The Family Connection," American Economic Review, American Economic Association, American Economic Association, vol. 96(2), pages 299-303, May.
  7. Leonid V. Azarnert, 2008. "Abortion and Human Capital Accumulation: A Contribution to the Understanding of the Gender Gap in Education," Working Papers, Bar-Ilan University, Department of Economics 2008-06, Bar-Ilan University, Department of Economics.
  8. Galor, Oded & Mountford, Andrew, 2008. "Trading Population for Productivity: Theory and Evidence," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6678, C.E.P.R. Discussion Papers.
  9. Leonid Azarnert, 2010. "Free education, fertility and human capital accumulation," Journal of Population Economics, Springer, Springer, vol. 23(2), pages 449-468, March.
  10. Leonid Azarnert, 2006. "Child mortality, fertility, and human capital accumulation," Journal of Population Economics, Springer, Springer, vol. 19(2), pages 285-297, June.
  11. Kazuhiro Yuki, 2005. "Sectoral Shift, Wealth Distribution, and Development," Development and Comp Systems 0509001, EconWPA.
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