IDEAS home Printed from https://ideas.repec.org/a/eee/reveco/v89y2024ipbp731-742.html
   My bibliography  Save this article

The impact of trade on growth and welfare with heterogeneous firms and rent-sharing

Author

Listed:
  • Nishiyama, Hiroyuki
  • Gintani, Yasuhiro
  • Tsuboi, Mizuki

Abstract

Can trade liberalization jointly lead to an increase in per capita GDP and higher welfare? To answer this question, we develop a tractable dynamic trade model with heterogeneous firms and rent-sharing. Analytically decomposing the impact of trade liberalization on per capita GDP and welfare into three or four forces, we first show that trade liberalization may lead to a decline in per capita GDP and deteriorate welfare. Our simulation then demonstrates that when rent-sharing effects are strong, a response of welfare to trade liberalization can be U-shaped or inverted U-shaped; giving a possible answer NO to our research question.

Suggested Citation

  • Nishiyama, Hiroyuki & Gintani, Yasuhiro & Tsuboi, Mizuki, 2024. "The impact of trade on growth and welfare with heterogeneous firms and rent-sharing," International Review of Economics & Finance, Elsevier, vol. 89(PB), pages 731-742.
    • Handle: RePEc:eee:reveco:v:89:y:2024:i:pb:p:731-742
    DOI: 10.1016/j.iref.2023.10.023
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1059056023003933
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.iref.2023.10.023?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Firm heterogeneity; Growth; Welfare; Rent-sharing; Trade liberalization;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:reveco:v:89:y:2024:i:pb:p:731-742. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620165 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.