Globalization and Growth

Gene M. Grossman and Elhanan Helpman

American Economic Review, 2015, vol. 105, issue 5, 100-104

Abstract: How does globalization affect economic growth? We discuss mechanisms that link international integration to the incentives for knowledge accumulation and the efficacy of that process. First, integration facilitates the flow of knowledge across national borders. Second, integration affords innovators a larger potential market even as it subjects them to additional competition from foreign rivals. Third, integration encourages specialization according to comparative advantage. Finally, integration affects the incentives for technological diffusion. Taken together, the literature offers many theoretical insights. Some progress has also been made on the empirical side, although data and methodological impediments have left assessment and measurement lagging behind.

JEL-codes: E23 F62 O33 O41 (search for similar items in EconPapers)
Date: 2015
Note: DOI: 10.1257/aer.p20151068
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Citations: View citations in EconPapers (69)

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