Trade, Non-Scale Growth, and Uneven Development
AbstractThis paper investigates the relationship between trade and economic development using a two-country, non-scale-growth model. Depending on the share of the expenditure for manufactured goods, we obtain two di erent results with regard to long-run production patterns. If the share of the expenditure is less than or equal to half, the leader country diversifies while the follower country asymptotically specializes in agriculture completely. If, on the other hand, the share of the expenditure is more than half, the leader country completely specializes in manufacturing while the follower country asymptotically specializes in agriculture completely. Whether or not the follower country can catch up with the leader country in the long run depends on two factors: (1) the patterns of production in both countries and (2) the measure of economic welfare that is used, that is, per capita income or per capita consumption.
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Bibliographic InfoPaper provided by Graduate School of Economics Project Center, Kyoto University in its series Discussion papers with number e-10-002.
Length: 35 pages
Date of creation: Jun 2010
Date of revision:
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More information through EDIRC
international trade; non-scale growth; uneven development;
Find related papers by JEL classification:
- F10 - International Economics - - Trade - - - General
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
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