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The Impact of International Trade on Economic Growth

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Author Info
Óscar Afonso () (CEMPRE, Faculdade de Economia da Universidade do Porto)

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Abstract

In this paper, we examine the studies, since Adam Smith, on the impact of commercial and technological aspects, resulting from international trade, on the physical accumulation and quality of productive factors. We remark that the theory of economic growth and the theory of international trade, during the ‘classic period’, constituted two inseparable branches of economics. In this epoch, it was believed that international trade has a positive effect on the economic growth. Later, during the ‘neoclassic period’, these two theories of the economic thought became autonomous relatively to each other. Consequently, the importance of international trade was neglected in the context of economic growth, especially until the 1960’s. Recently, with the introduction of models of endogenous growth, both theories have merged again. The modelling frameworks advanced by the new models, as well as the recent developments inside the international trade theory, has allowed us to obtain a better understanding of the relation between economic growth and international trade.

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Publisher Info
Paper provided by Universidade do Porto, Faculdade de Economia do Porto in its series FEP Working Papers with number 106.

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Length: 33 pages
Date of creation: May 2001
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Handle: RePEc:por:fepwps:106

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Keywords: economic growth international trade endogenous growth comparative advantages developed countries less developed countries.

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  28. De Long, J Bradford & Summers, Lawrence H, 1991. "Equipment Investment and Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 445-502, May. [Downloadable!] (restricted)
    Other versions:
  29. Rivera-Batiz, Luis A. & Romer, Paul M., 1991. "International trade with endogenous technological change," European Economic Review, Elsevier, vol. 35(4), pages 971-1001, May. [Downloadable!] (restricted)
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  1. Rosa Forte, 2004. "The relationship between foreign direct investment and international trade. Substitution or complementarity? A survey," FEP Working Papers 140, Universidade do Porto, Faculdade de Economia do Porto. [Downloadable!]
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