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Endogenous Globalization and Income Divergence

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  • Yoshiaki Sugimoto

    (Department of Economics, European University Institute)

Abstract

This paper develops a growth theory that accounts for the evolution of trade policy, underlying internal class conflicts, and global income divergence over the last few centuries. By analyzing political responses to the distributional effects of international trade, this paper finds a prominent interaction between trade policy and the pattern of economic development, and suggests that the nature of the interaction depends on a country's resource abundance and distribution. As shown by the example of Western Europe, land-scarce countries will reach a developed stage through a non-monotonic evolution of trade policy. In contrast, land- abundant countries, especially those with concentrated landownership, tend to fail to take off because of landlords' opposition to industrialization.

Suggested Citation

  • Yoshiaki Sugimoto, 2005. "Endogenous Globalization and Income Divergence," Development and Comp Systems 0503003, EconWPA.
  • Handle: RePEc:wpa:wuwpdc:0503003
    Note: Type of Document - pdf; pages: 54
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    References listed on IDEAS

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    More about this item

    Keywords

    Trade Policy; Growth; Class Conflict;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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