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Diverging Populations and Endogenous Growth in a Model of Meaningless Trade

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  • Deardorff, A.V.

Abstract

The endogenous growth literature raises the possibility that countries may grow without bound in terms of per capita income, and that they may do so at different rates. This possibility also exists in neoclassical growth models with diverging populations - populations that grow at different rates. In both cases, however, this means that international inequality of per capita incomes will not only exist but also get worse over time. This paper examines that possibility within a very simple one-sector model that allows for both diverging populations and endogenous growth. The model also allows for "meaningless" trade and international direct investment, in the sense that these occur at random across countries when traders and investors are indifferent among locations.

Suggested Citation

  • Deardorff, A.V., 1997. "Diverging Populations and Endogenous Growth in a Model of Meaningless Trade," Working Papers 421, Research Seminar in International Economics, University of Michigan.
  • Handle: RePEc:mie:wpaper:421
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    Cited by:

    1. Trefler, Daniel & Zhu, Susan Chun, 2010. "The structure of factor content predictions," Journal of International Economics, Elsevier, vol. 82(2), pages 195-207, November.

    More about this item

    Keywords

    ECONOMIC GROWTH ; POPULATION ; INCOME;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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