An Extension of the Structural Change Model to International Economic Relations

Ricardo Araujo and Joanílio Teixeira ()

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper Pasinetti’s model of structural economic dynamics (1981) is extended to consider international economic relations. Conditions for full employment, full expenditure of income and equilibrium of the trade balance are established for an open economy that requires capital goods to produce final commodities. Analytical results concerning the benefits from free trade and international learning are formally studied. In addition, static and dynamic aspects of the ‘principle of comparative cost advantage’ are analysed considering the determinants of the specialisation level.

Keywords: structural change; international economic relations; capital goods. (search for similar items in EconPapers)
JEL-codes: F19 O41 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (16)

Published in Metroeconomica 54.4(2003): pp. 458-473

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Journal Article: An Extension of the Structural Change Model to International Economic Relations (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:53291

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