Growth, Trade, and Inequality

Elhanan Helpman and Gene Grossman

No 10235, CEPR Discussion Papers from Centre for Economic Policy Research

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.

Keywords: Endogenous growth; Income distribution; Income inequality; Innovation; Trade and growth (search for similar items in EconPapers)
JEL-codes: D33 F12 F16 O41 (search for similar items in EconPapers)
Date: 2014-11
New Economics Papers: this item is included in nep-gro, nep-ino, nep-int and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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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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