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Learning by Doing, Trade in Capital Goods and Growth

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  • Goh, Ai-Ting

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) ; National University of Singapore)

  • Olivier, Jacques

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) ; National University of Singapore ; HEC School of Management ; CEPPR)

Abstract

The paper aims at reconciling theoretical models of endogenous growth with the empirical evidence on trade and growth. In particular, we show that the conventional wisdom according to which trade is growth-impairing for a country with comparative advantage in goods with limited opportunities for learning fails to hold when the imported good is a capital good. The intuition is that the country gains access to cheaper capital goods, which raises investment, output per worker and learning by doing.

Suggested Citation

  • Goh, Ai-Ting & Olivier, Jacques, 2001. "Learning by Doing, Trade in Capital Goods and Growth," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2001002, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  • Handle: RePEc:ctl:louvir:2001002
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    References listed on IDEAS

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    Cited by:

    1. Goo, Youngwan & Park, Hyun, 2007. "Economic growth and convergence with international differences in technology," Journal of Macroeconomics, Elsevier, vol. 29(1), pages 145-168, March.
    2. Maria Bas & Antoine Berthou, 2017. "Does Input-Trade Liberalization Affect Firms’ Foreign Technology Choice?," World Bank Economic Review, World Bank Group, vol. 31(2), pages 351-384.
    3. Subhadip Mukherjee & Rupa Chanda, 2019. "Trade Liberalization and Indian Manufacturing MSMEs: Role of Firm Characteristics and Channel of Liberalization," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(4), pages 984-1062, September.
    4. Christiaans, Thomas, 2008. "International trade and industrialization in a non-scale model of economic growth," Structural Change and Economic Dynamics, Elsevier, vol. 19(3), pages 221-236, September.
    5. Mellati, Ali, 2008. "Technology, Trade Specialization and Development: Jumping to Technology Development Era," MPRA Paper 26643, University Library of Munich, Germany.
    6. Maria Bas & Antoine Berthou, 2016. "Does input-trade liberalization affect firms' foreign technology choice?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01387558, HAL.
    7. Sucharita Ghosh & Camilla Mastromarco, 2013. "Cross-border Economic Activities, Human Capital and Efficiency: A Stochastic Frontier Analysis for OECD Countries," The World Economy, Wiley Blackwell, vol. 36(6), pages 761-785, June.
    8. Christine Mutz & Thomas Ziesemer, 2008. "Simultaneous estimation of income and price elasticities of export demand, scale economies and total factor productivity growth for Brazil," Applied Economics, Taylor & Francis Journals, vol. 40(22), pages 2921-2937.
    9. Domeland, Dorte, 2007. "Trade and human capital accumulation: evidence from U.S. immigrants," Policy Research Working Paper Series 4144, The World Bank.
    10. An, Galina & Iyigun, Murat F., 2004. "The export technology content, learning by doing and specialization in foreign trade," Journal of International Economics, Elsevier, vol. 64(2), pages 465-483, December.
    11. C. Veeramani, 2008. "Impact of imported intermediate and capital goods on economic growth: A Cross country analysis," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2008-029, Indira Gandhi Institute of Development Research, Mumbai, India.

    More about this item

    Keywords

    trade; capital goods; growth;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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