Sustained Comparative Advantage and Semi-Endogenous Growth

Iordanis Petsas ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper constructs a two-country (Home and Foreign) general equilibrium model of Schumpeterian growth without scale effects. The scale effects property is removed by introducing a distinct specification in the knowledge production function which generates semi-endogenous growth. In this model of semi-endogenous growth, an increase in the rate of population growth rate raises Home’s relative wage and lowers its range of goods exported to Foreign. An increase in the size of innovations increases Home’s relative wage but with an ambiguous effect on its comparative advantage. The model generates a unique steady-state equilibrium in which there is complete specialization in both goods and R&D production within each country.

Keywords: Comparative advantage; Trade; Schumpeterian growth; Scale effects; R&D races (search for similar items in EconPapers)
JEL-codes: F0 O10 O30 O40 (search for similar items in EconPapers)
Date: 2009-01
New Economics Papers: this item is included in nep-dge and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Sustained Comparative Advantage and Semi‐Endogenous Growth (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:14297

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