A Schumpeterian Model of Protection and Relative Wages

Elias Dinopoulos and Paul Segerstrom
Additional contact information
Elias Dinopoulos: University of Florida

No 471, Working Paper Series from Research Institute of Industrial Economics

Abstract: This paper presents a dynamic general equilibrium model of trade between two advanced countries in which both innovation and skilled acquisition rates are endogenously determined. The model offers a North-North (as opposed to a North-South) trade explanation for increasing relative wage inequality. A global reduction in trade barriers increases R&D investment and accelerates the pace of technological progress. It also reduces the relative wage of unskilled workers and results in skill upgrading, if and only if R&D is the skill-intensive activity relative to manufacturing of final products. Trade liberalization does not affect domestic relative prices in either of the two countries.

Keywords: Economic growth; R&D; Protection; Relative Wages (search for similar items in EconPapers)
JEL-codes: D41 F10 F12 F13 (search for similar items in EconPapers)
Pages: 42 pages
Date: 1996-10
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.ifn.se/wfiles/wp/wp471.pdf (application/pdf)

Related works:
Journal Article: A Schumpeterian Model of Protection and Relative Wages (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hhs:iuiwop:0471

Access Statistics for this paper

More papers in Working Paper Series from Research Institute of Industrial Economics Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Elisabeth Gustafsson ().