Explaining Japan's Innovation and Trade: A model of Quality Competition and Dynamic Comparive Advantage
In this paper, I develop a model of dynamic comparative advantage based on endogenous innovation. Firms in each of two countries devote resources to R&D in order to improve the quality of high-technology products. Research successes generate profit opportunities in the world market. The model predicts that a country such as Japan, with abundance of skilled labor and scarcity of natural resources, will specialize relatively in industrial innovation and in the production of high-technology goods. Data are provided to support this prediction. I use the model to explore the effects of R&D subsidies, production subsidies and trade policies on the long-run rates of innovation in trade partner countries and on the long-run pattern of trade.
|Date of creation:||Dec 1989|
|Date of revision:|
|Publication status:||published as Bank of Japan Monetary and Economic Studies, Vol. 8, No. 2, pp. 75-100, September 1990.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Segerstrom, Paul S & Anant, T C A & Dinopoulos, Elias, 1990. "A Schumpeterian Model of the Product Life Cycle," American Economic Review, American Economic Association, vol. 80(5), pages 1077-91, December.
- Balassa, Bela & Noland, Marcus, 1989. "The changing comparative advantage of Japan and the United States," Journal of the Japanese and International Economies, Elsevier, vol. 3(2), pages 174-188, June.
- Bowen, Harry P, 1983. "Changes in the International Distribution of Resources and Their Impact on U.S. Comparative Advantage," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 402-14, August.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:3194. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.