On Endogenous Product Cycles under Costly Trade

Cristobal Campoamor, Adolfo (2015): On Endogenous Product Cycles under Costly Trade.

Abstract

The catchup and convergence of developing economies with the Western world is a major experience in modern history. In this paper we explore the role played jointly by technological imitation and trade liberalization in a North-South endogenous growth model. We prove that a gradual trade liberalization between South and North will promote convergence at any level of initial trade costs if the Southern economies are fully industrialized, their R&D potential is relatively low and the elasticity of substitution among manufactures is high enough.

• Item Type: MPRA Paper
• Language: English
• Keywords: Product Cycles; Convergence; Trade Openness; Endogenous Growth
• Subjects: F - International Economics > F6 - Economic Impacts of Globalization > F63 - Economic Development; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O41 - One, Two, and Multisector Growth Models

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