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Comparative Advantage and Long-run Growth

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  • Grossman, Gene M
  • Helpman, Elhanan

Abstract

The authors construct a dynamic, two country model of trade and growth in which endogenous technological progress results from the profit-maximizing behavior of entrepreneurs. They study the role that the external trading environment and that trade and industrial policies play in the determination of long-run growth rates. Cross-country differences in efficiency at R&D versus manufacturing (i.e., comparative advantage) bear importantly on the growth effects of economic structure and commercial policies. Copyright 1990 by American Economic Association.

Suggested Citation

  • Grossman, Gene M & Helpman, Elhanan, 1990. "Comparative Advantage and Long-run Growth," American Economic Review, American Economic Association, vol. 80(4), pages 796-815, September.
    • Handle: RePEc:aea:aecrev:v:80:y:1990:i:4:p:796-815
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