Globalization, Returns to Accumulationa and the World Distribution of Output
Paul Beaudry and
Fabrice Collard
No 10565, NBER Working Papers from National Bureau of Economic Research, Inc
Abstract:
This paper examines the extent to which the process of globalization can explain the observed widening in the cross--country distribution of output--per--worker. In particular examine whether the opening up of trade in a Hecksher--Ohlin type model of trade can explain the observed changes. On the theoretical front the model highlights that, when the labor market is subject to a holdup problem, then the opening up of trade can cause an increase in the dispersion of income across countries similar to that observed in the data due to the emergence of a discrepancy between the private and social returns to capital accumulation that favors capital abundant countries. On the empirical front, we document the relevance of the model by examining whether growth patterns, decomposition exercises and specialization patterns support the model's predictions. Overall we find that over 50% of the recently observed increase in income dispersion across countries can be accounted for by the mechanism exemplified by the model.
JEL-codes: O33 O41 (search for similar items in EconPapers)
Date: 2004-06
New Economics Papers: this item is included in nep-dev
Note: EFG ITI
References: View references in EconPapers View complete reference list from CitEc
Citations:
Published as Beaudry, Paul & Collard, Fabrice, 2006. "Globalization, returns to accumulation and the world distribution of output," Journal of Monetary Economics, Elsevier, vol. 53(5), pages 879-909, July.
Downloads: (external link)
http://www.nber.org/papers/w10565.pdf (application/pdf)
Related works:
Journal Article: Globalization, returns to accumulation and the world distribution of output (2006) 
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:nbr:nberwo:10565
Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w10565
Access Statistics for this paper
More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().