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Income Distribution, Technical Change and the Dynamics of International Economic Integration

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  • Michael Landesmann

    ()
    (The Vienna Institute for International Economic Studies, wiiw)

  • Robert Stehrer

    ()
    (The Vienna Institute for International Economic Studies, wiiw)

Abstract

This paper explores the features of a dynamic multisectoral model which focuses on the relationship between income distribution, growth and international specialization. The model is explored both for the steady-state properties and the transitory dynamics of integrated economies. Income inequality affects the patterns of growth and international specialization as the model uses non-linear Engel curves and hence different income groups are characterized by different expenditure patterns. At the same time income distribution is also reflected in the relative wage rates of skilled to unskilled workers, i.e. the skill premium, and hence the wage structure affects comparative costs of industries which have different skill intensities. The model is applied to a situation which analyses qualitatively different economic development strategies of catching-up economies (a 'Latin American' scenario and a 'South East Asian' scenario).

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Bibliographic Info

Paper provided by The Vienna Institute for International Economic Studies, wiiw in its series wiiw Working Papers with number 31.

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Date of creation: Sep 2004
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Publication status: Published as wiiw Working Paper
Handle: RePEc:wii:wpaper:31

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Related research

Keywords: income distribution; growth; international economic integration; catching-up; international specialization;

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Cited by:
  1. Robert Stehrer, 2005. "Employment, Education and Occupation Structures: A Framework for Forecasting," wiiw Research Reports 315, The Vienna Institute for International Economic Studies, wiiw.
  2. Iván Arribas & Francisco Pérez & Emili Tortosa-Ausina, 2014. "The dynamics of international trade integration: 1967–2004," Empirical Economics, Springer, vol. 46(1), pages 19-41, February.
  3. Michael Landesmann & Robert Stehrer, 2009. "South-North Integration, Outsourcing and Skills," wiiw Research Reports 353, The Vienna Institute for International Economic Studies, wiiw.
  4. Landesmann, M.A. & Stehrer, R., 2006. "Goodwin's structural economic dynamics: Modelling Schumpeterian and Keynesian insights," Structural Change and Economic Dynamics, Elsevier, vol. 17(4), pages 501-524, December.

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