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Gains and Losses from International Trade in a Knowledge-driven Semi-endogenous Growth Model with Heterogeneous Firms

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  • katsufumi, fukuda
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    Abstract

    We consider a semi endogenous R&D growth model with international trade, firm heterogeneity, and local knowledge spillover in a closed economy and international knowledge spillover in a symmetric two country economy. We show that by opening trade R&D difficulty (the number of varieties produced) and welfare are ambiguously affected. When the international spillover is large (small), the former is increased (decreased). When the size of the international knowledge spillover is large (small) or the size of the international knowledge spillover is small and the size of intertemporal knowledge spillover is small (large), the latter increases (decreses). Without intertemporal and international knowledge spillovers, welfare increases.

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    Bibliographic Info

    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 40818.

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    Date of creation: 21 Aug 2012
    Date of revision: 22 Aug 2012
    Handle: RePEc:pra:mprapa:40818

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    Keywords: Heterogeneous Firms; Semi Endogenous Growth; Gains and Losses from International Trade;

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    1. Bulent Unel, 2010. "Technology Diffusion through Trade with Heterogeneous Firms," Review of International Economics, Wiley Blackwell, vol. 18(3), pages 465-481, 08.
    2. Baldwin, Richard & Robert-Nicoud, Frédéric, 2005. "Trade and Growth with Heterogeneous Firms," CEPR Discussion Papers 4965, C.E.P.R. Discussion Papers.
    3. Peter Gustafsson & Paul Segerstrom, 2010. "Trade Liberalization and Productivity Growth," Review of International Economics, Wiley Blackwell, vol. 18(2), pages 207-228, 05.
    4. Segerstrom, Paul S, 1998. "Endogenous Growth without Scale Effects," American Economic Review, American Economic Association, vol. 88(5), pages 1290-1310, December.
    5. Elias Dinopoulos & Constantinos Syropoulos, 2007. "Rent Protection as a Barrier to Innovation and Growth," Economic Theory, Springer, vol. 32(2), pages 309-332, August.
    6. Bulent Unel & Elias Dinopoulos, . "Quality Heterogeneity and Global Economic Growth," Departmental Working Papers 2009-06, Department of Economics, Louisiana State University.
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