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Agglomeration and Growth Effects of Trade Liberalization

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Author Info

  • Kind, H.J.

Abstract

This paper develops a growth model with two countries, where researchers use formerly developed intermediate goods as inputs. It is found that trade liberalization in these goods speeds up the growth rate if trade costs initially are small and we allow internatinal wages to differ. On the other hand, there is possibly no relationhip between growth and trade liberalization for higher levels of trade costs. The reason is that agglomeration forces then may have led the entire reserach sector to concentrate into one country.

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Bibliographic Info

Paper provided by Norwegian School of Economics and Business Administration- in its series Papers with number 30/98.

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Length: 23 pages
Date of creation: 1998
Date of revision:
Handle: RePEc:fth:norgee:30/98

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Postal: NORWEGIAN SCHOOL OF ECONOMICS AND BUSINESS ADMINISTRATION, HELLEVEIEN 30, 5035 BERGEN SANDVIKEN NORWAY.
Phone: 5595 9000
Fax: 5595 9100
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Web page: http://www.nhh.no/
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Keywords: GROWTH MODELS ; ECONOMIC DEVELOPMENT ; TRADE LIBERALIZATION;

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