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Vertical Specialization with Heterogeneous Entrepreneurs: Can Trade Promote Industrialization of Developing Countries?


  • Chu, T.


This paper explores the theoretical link between trade liberalization and industrial development indeveloping economies. A two-country, three- good, and three-factor computable general equilibrium model is developed, which features a capital-intensive intermediate good, and a special factor of production, the entrepreneurial skill.

Suggested Citation

  • Chu, T., 2001. "Vertical Specialization with Heterogeneous Entrepreneurs: Can Trade Promote Industrialization of Developing Countries?," Papers 310, Minnesota - Center for Economic Research.
  • Handle: RePEc:fth:minner:310

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    References listed on IDEAS

    1. Paul Klemperer, 1990. "How Broad Should the Scope of Patent Protection Be?," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 113-130, Spring.
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    3. Richard Gilbert & Carl Shapiro, 1990. "Optimal Patent Length and Breadth," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 106-112, Spring.
    4. Pakes, Ariel S, 1986. "Patents as Options: Some Estimates of the Value of Holding European Patent Stocks," Econometrica, Econometric Society, vol. 54(4), pages 755-784, July.
    5. Ted O'Donoghue & Suzanne Scotchmer & Jacques-François Thisse, 1998. "Patent Breadth, Patent Life, and the Pace of Technological Progress," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 7(1), pages 1-32, March.
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    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • F10 - International Economics - - Trade - - - General


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