Innovation, Diffusion, and Trade: Theory and Measurement
Abstract
Growth and imports are correlated across countries, but the mechanisms underlying this relationship are not well understood. I develop a multi-country model in which imports and growth are connected by technological innovations and their international diffusion through trade. Fitting the model to data on innovation, productivity, and trade in varieties, I find that most of the growth-imports correlation is explained by these two mechanisms. I also find that the trade channel has been particularly important in developing countries, accounting for about three-fourths of their growth. Finally, I run counterfactuals analysis.Download Info
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 35311.Length:
Date of creation: 07 Dec 2011
Date of revision:
Handle: RePEc:pra:mprapa:35311
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Related research
Keywords: Trade; productivity; innovation; technology diffusion; growth;Find related papers by JEL classification:
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
- O30 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - General
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-12-19 (All new papers)
- NEP-EFF-2011-12-19 (Efficiency & Productivity)
- NEP-INO-2011-12-19 (Innovation)
- NEP-KNM-2011-12-19 (Knowledge Management & Knowledge Economy)
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Citations
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- Ana Santacreu, 2012. "The Trade Comovement Puzzle and the Margins of International Trade," 2012 Meeting Papers 34, Society for Economic Dynamics.
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