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Extending the Learning-By-Exporting Hypothesis: Introducing a Credit Constraint

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  • Kazuhiko Yokota

    ()

  • Akinori Tomohara

    ()

Abstract

This paper develops a theoretical framework which can be used to examine policy implications from the learning-by-exporting hypothesis. This work builds on previous theoretical literature by introducing a credit constraint. When credit is available, the analysis suggests that supporting a learning sector via an export subsidy is not necessarily advised to improve social welfare. The learning sector’s goods may be over-produced (relative to another non-tradable sector goods) when consumers can borrow freely for their consumption. If the learning sector’s goods are over-produced, social welfare will be improved via a tax on production. Copyright International Atlantic Economic Society 2009

Suggested Citation

  • Kazuhiko Yokota & Akinori Tomohara, 2009. "Extending the Learning-By-Exporting Hypothesis: Introducing a Credit Constraint," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 15(2), pages 169-177, May.
  • Handle: RePEc:kap:iaecre:v:15:y:2009:i:2:p:169-177:10.1007/s11294-009-9202-2
    DOI: 10.1007/s11294-009-9202-2
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    References listed on IDEAS

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    More about this item

    Keywords

    Export subsidy; Learning-by-exporting; Knowledge spillover; F1; F4; O2;

    JEL classification:

    • F1 - International Economics - - Trade
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy

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