Knowledge Diffusion and Trade across Countries and Sectors

Nan Li, Jie Cai () and Ana Maria Santacreu

No 692, 2017 Meeting Papers from Society for Economic Dynamics

Abstract: Countries and sectors interact through knowledge spillovers and international trade flows. These interactions drive differences in income per capita and innovation not only across countries, but also across sectors within a country. We develop and quantify a model of innovation, knowledge diffusion and trade that can explain these differences. Using data on intersectoral patent citations, R&D expenditures and international trade flows, we calibrate the model and perform several counterfactual exercises. Decreases in trade costs or increases in the speed of diffusion reallocate resources across countries and sectors, generating a distributional effect on aggregate innovation and growth.

Date: 2017
New Economics Papers: this item is included in nep-cse, nep-dge, nep-ino, nep-int, nep-knm, nep-tid and nep-ure
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Citations: View citations in EconPapers (13)

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Related works:
Working Paper: Knowledge Diffusion and Trade Across Countries and Sectors (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed017:692

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