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Technology and the Global Economy

Author

Listed:
  • Jonathan Eaton

    (Pennsylvania State University)

  • Samuel Kortum

    (Yale University)

Abstract

Interpreting individual heterogeneity in terms of probability theory has proved powerful in connecting behaviour at the individual and aggregate levels. Returning to Ricardo's focus on comparative efficiency as a basis for international trade, much recent quantitative equilibrium modeling of the global economy builds on particular probabilistic assumptions about technology. We review these assumptions and how they deliver a unified framework underlying a wide range of static and dynamic equilibrium models.

Suggested Citation

  • Jonathan Eaton & Samuel Kortum, 2024. "Technology and the Global Economy," Cowles Foundation Discussion Papers 2385, Cowles Foundation for Research in Economics, Yale University.
    • Handle: RePEc:cwl:cwldpp:2385
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    File URL: https://economics.yale.edu/sites/default/files/2024-03/d2385.pdf
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    References listed on IDEAS

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    1. repec:spo:wpmain:info:hdl:2441/6apm7lruv088iagm4rv2c33jtg is not listed on IDEAS
    2. Bental, Benjamin & Peled, Dan, 1996. "The Accumulation of Wealth and the Cyclical Generation of New Technologies: A Search Theoretic Approach," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(3), pages 687-718, August.
    3. Krugman, Paul, 1979. "A Model of Innovation, Technology Transfer, and the World Distribution of Income," Journal of Political Economy, University of Chicago Press, vol. 87(2), pages 253-266, April.
    4. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth through Creative Destruction," Econometrica, Econometric Society, vol. 60(2), pages 323-351, March.
    5. Ezra Oberfield, 2018. "A Theory of Input–Output Architecture," Econometrica, Econometric Society, vol. 86(2), pages 559-589, March.
    6. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2011. "An Anatomy of International Trade: Evidence From French Firms," Econometrica, Econometric Society, vol. 79(5), pages 1453-1498, September.
    7. Evenson, Robert E & Kislev, Yoav, 1976. "A Stochastic Model of Applied Research," Journal of Political Economy, University of Chicago Press, vol. 84(2), pages 265-281, April.
    8. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
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    Cited by:

    1. Mariam Camarero & Joan Crespo & Cecilio Tamarit, 2025. "FDI and the evolution of the comparative advantage of nations," Working Papers 2511, Department of Applied Economics II, Universidad de Valencia.

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    More about this item

    JEL classification:

    • F0 - International Economics - - General
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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