Growth, Trade, and Inequality

Gene Grossman and Elhanan Helpman

No 20502, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We introduce firm and worker heterogeneity into a model of innovation-driven endogenous growth. Individuals who differ in ability sort into either a research sector or a manufacturing sector that produces differentiated goods. Each research project generates a new variety of the differentiated product and a random technology for producing it. Technologies differ in complexity and productivity, and technological sophistication is complementary to worker ability. We study the co-determination of growth and income inequality in both the closed and open economy, as well as the spillover effects of policy and conditions in one country to outcomes in others.

JEL-codes: D33 F12 F16 O41 (search for similar items in EconPapers)
Date: 2014-09
New Economics Papers: this item is included in nep-gro, nep-ino, nep-int and nep-ltv
Note: EFG ITI
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Citations: View citations in EconPapers (10)

Published as Grossman, G. M. and Helpman, E. (2018), Growth, Trade, and Inequality. Econometrica, 86: 37-83. doi:10.3982/ECTA14518

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Related works:
Journal Article: Growth, Trade, and Inequality (2018)
Working Paper: Growth, Trade, and Inequality (2016)
Working Paper: Growth, Trade, and Inequality (2014)
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