Notes on factor price equality and biased technical change in a two-cone trade model
Daniel Becker () and
Erich Gundlach ()
No 1300, Kiel Working Papers from Kiel Institute for the World Economy (IfW)
We reconsider the effects of long-run economic growth on relative factor prices across cones of specialization. We model economic growth as exogenous technical change. Allowing for capital biased technical change with a sector bias and for endogenous commodity prices, we find that economic growth may increase or decrease factor price differences across cones. For a neutral demand side and capital biased growth in the most capital intensive sector, we find that economic growth encourages less factor price diversity across cones.
Keywords: Economic growth; Two cone trade model; Factor price equality (search for similar items in EconPapers)
JEL-codes: F11 O40 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
Working Paper: Notes on factor price equality and biased technical change in a two-cone trade model (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:1300
Access Statistics for this paper
More papers in Kiel Working Papers from Kiel Institute for the World Economy (IfW) Contact information at EDIRC.
Series data maintained by ZBW - German National Library of Economics ().