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Learning by Doing, Trade in Capital Goods and Growth

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Author Info
Goh, Ai-Ting () (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) ; National University of Singapore)
Olivier, Jacques (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) ; National University of Singapore ; HEC School of Management ; CEPPR)
Abstract

The paper aims at reconciling theoretical models of endogenous growth with the empirical evidence on trade and growth. In particular, we show that the conventional wisdom according to which trade is growth-impairing for a country with comparative advantage in goods with limited opportunities for learning fails to hold when the imported good is a capital good. The intuition is that the country gains access to cheaper capital goods, which raises investment, output per worker and learning by doing.

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Paper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) Discussion Paper with number 2001002.

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Length: 44
Date of creation: 00 2001
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Handle: RePEc:ctl:louvir:2001002

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Related research
Keywords: trade capital goods growth

Find related papers by JEL classification:
F10 - International Economics - - Trade - - - General
O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

This paper has been announced in the following NEP Reports:

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  7. Francisco Rodriguez & Dani Rodrik, 1999. "Trade Policy and Economic Growth: A Skeptic's Guide to Cross-National Evidence," NBER Working Papers 7081, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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