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Globalization, Divergence and Stagnation

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  • Gancia, Gino

    (Institute for International Economic Studies, Stockholm University)

Abstract

In a world where poor countries provide weak protection for intellectual property rights, market integration will systematically shift technical change in favor of rich nations. For this reason, free trade can increase international income differences. At the same time, integration with countries where intellectual property rights are weakly protected can have a large adverse effect on the world growth rate. These results provide a strong rationale for global regulations, critical in a system of interdependent economies for sustaining innovation and reducing income inequality. Supportive empirical evidence is presented.

Suggested Citation

  • Gancia, Gino, 2003. "Globalization, Divergence and Stagnation," Seminar Papers 720, Stockholm University, Institute for International Economic Studies.
  • Handle: RePEc:hhs:iiessp:0720
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    Cited by:

    1. Schiffbauer, Marc, 2006. "Theoretical and methodological study on the role of public policies in fostering innovation and growth," Papers DYNREG04, Economic and Social Research Institute (ESRI).
    2. Gancia, Gino & Zilibotti, Fabrizio, 2005. "Horizontal Innovation in the Theory of Growth and Development," Handbook of Economic Growth,in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 3, pages 111-170 Elsevier.
    3. Jonathan Eaton & Samuel Kortum, 2006. "Innovation, Diffusion, and Trade," NBER Working Papers 12385, National Bureau of Economic Research, Inc.
    4. Dinopoulos, Elias & Segerstrom, Paul, 2003. "A Theory of North-South Trade and Globalization," CEPR Discussion Papers 4140, C.E.P.R. Discussion Papers.
    5. Ventura, Jaume, 2005. "A Global View of Economic Growth," Handbook of Economic Growth,in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 22, pages 1419-1497 Elsevier.
    6. Stryszowski, P.K., 2006. "Intellectual Property Rights, Globalization and Growth," Discussion Paper 2006-76, Tilburg University, Center for Economic Research.
    7. Daron Acemoglu, 2007. "Equilibrium Bias of Technology," Econometrica, Econometric Society, vol. 75(5), pages 1371-1409, September.
    8. Gabriel Felbermayr, 2004. "Does trade cause divergence? Dynamic panel data evidence," Economics working papers 2004-07, Department of Economics, Johannes Kepler University Linz, Austria.

    More about this item

    Keywords

    Economic Growth; North-South Trade; Intellectual Property Rights; Cross-Country Income Differences; Innovation Diversion;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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