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Endogenous Growth and Trade Liberalization Between Small and Large Countries

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  • Hans Jarle Kind

Abstract

The paper combines insight from new trade theory and R&D‐based endogenous growth models to argue that there are ambiguous growth effects of trade liberalization between countries that differ in terms of the size of their home markets. In particular, trade liberalization may reduce R&D incentives in countries with low purchasing power without invoking parallel increases in countries with high purchasing power. The paper also considers the case of imperfect international knowledge spillovers, and demonstrates that complete trade liberalization may affect the growth rate negatively.

Suggested Citation

  • Hans Jarle Kind, 2002. "Endogenous Growth and Trade Liberalization Between Small and Large Countries," Review of International Economics, Wiley Blackwell, vol. 10(1), pages 151-165, February.
    • Handle: RePEc:bla:reviec:v:10:y:2002:i:1:p:151-165
    DOI: 10.1111/1467-9396.00324
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    Cited by:

    1. Chang, Chiu-Lan & Fang, Ming, 2022. "Renewable energy-led growth hypothesis: New insights from BRICS and N-11 economies," Renewable Energy, Elsevier, vol. 188(C), pages 788-800.
    2. Biswajit Maitra & Moutushi Chakraborty, 2023. "Foreign Trade, Human Capital and Economic Growth in India under the Liberalised Trade Regime," Journal of Asian Economic Integration, , vol. 5(1), pages 29-50, April.
    3. Iader Giraldo, 2016. "Does International Trade Produce Convergence?," Documentos de Trabajo 15161, Universidad del Rosario.

    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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