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Exporting and Productivity Growth: Theory

In: Globalisation and Productivity Growth

Author

Listed:
  • Rod Falvey
  • Zhihong Yu

Abstract

Traditional treatments of the gains from trade were primarily concerned with the static gains realisable from realigning production in accordance with comparative advantage. In an open economy, resources would be (re)allocated more ‘productively’, taking advantage of the opportunities to import those products in whose production the country is relatively less efficient by exporting those in whose production it is relatively more efficient. These gains are available even if autarky production is technically efficient (i.e. on the production possibility frontier), and in a world where technologies exhibit constant returns to scale, firms are largely irrelevant and the effects of trade on the efficiency of resource use within the industry cannot be explored.

Suggested Citation

  • Rod Falvey & Zhihong Yu, 2005. "Exporting and Productivity Growth: Theory," Palgrave Macmillan Books, in: Holger Görg & David Greenaway & Richard Kneller (ed.), Globalisation and Productivity Growth, chapter 7, pages 117-135, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-52322-7_7
    DOI: 10.1057/9780230523227_7
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    Cited by:

    1. Priit Vahter, 2011. "Learning By Exporting: Evidence Based on Data of Knowledge Flows from Innovation Surveys in Estonia," William Davidson Institute Working Papers Series wp1011, William Davidson Institute at the University of Michigan.
    2. Jaan Masso & Priit Vahter, 2011. "Exporting And Productivity: The Effects Of Multi-Market And Multi-Product Export Entry," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 83, Faculty of Economics and Business Administration, University of Tartu (Estonia).

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