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International trade and structural change: a dynamic model of weak sustainability

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  • Louis Dupuy

    (Larefi, Université de Bordeaux)

Abstract

We present a dynamic Heckscher-Ohlin model to study structural change in a sustainability context. We show how resource rich economies maximising steady-state consumption should adopt different development strategies depending on the distribution of domestic wealth instruments (assets). Owing to the diversity of development strategies available to both natural resource rich and produced capital rich countries, trade liberalisation is not necessarily the best outcome for sustainability in both types of countries. We offer to amend Adjusted Net Savings (ANS) to include in the indicator trade-induced specialisation gains from trade to fund structural change and diversification, against economic incentives for specialisation.

Suggested Citation

  • Louis Dupuy, 2015. "International trade and structural change: a dynamic model of weak sustainability," Larefi Working Papers 1501, Larefi, Université Bordeaux 4.
    • Handle: RePEc:laf:wpaper:cr1501
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    File URL: http://laf.u-bordeaux4.fr/RePEc/CR-15EFI-01.pdf
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    References listed on IDEAS

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    Cited by:

    1. Nick Hanley & Louis Dupuy & Eoin McLaughlin, 2015. "Genuine Savings And Sustainability," Journal of Economic Surveys, Wiley Blackwell, vol. 29(4), pages 779-806, September.

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    More about this item

    Keywords

    Sustainability; International Trade; Heckscher-Ohlin models; Structural Change;
    All these keywords.

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F18 - International Economics - - Trade - - - Trade and Environment
    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • Q37 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Issues in International Trade

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