Trade Liberalisation, Process and Product Innovation, and Relative Skill Demand
AbstractThe interaction between trade liberalisation, product and process innovation, and relative skill demand is analysed in a model of international oligopoly. Lower trading barriers increase the degree of foreign competition. The competing enterprises respond by investing more aggressively in lowering marginal costs of production. Moreover, firms reduce the substitutability of their products through additional investment in product innovation. The paper also shows that the relative demand for skilled workers may increase as a result.
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Bibliographic InfoPaper provided by Sonderforschungsbereich 649, Humboldt University, Berlin, Germany in its series SFB 649 Discussion Papers with number SFB649DP2007-001.
Length: 19 pages
Date of creation: Jan 2007
Date of revision:
Intra-industry Trade; Process Innovation; Product Innovation; Relative Skill Demand; Trade Liberalisation;
Other versions of this item:
- Sebastian Braun, 2006. "Trade Liberalisation, Process and Product Innovation, and Relative Skill Demand," JEPS Working Papers 06-004, JEPS.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
- F15 - International Economics - - Trade - - - Economic Integration
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
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