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Technology Diffusion through Trade with Heterogeneous Firms
Author(s) -
Unel Bulent
Publication year - 2010
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/j.1467-9396.2010.00880.x
Subject(s) - economics , endogenous growth theory , productivity , diffusion , welfare , product (mathematics) , international trade , consumer welfare , international economics , trade barrier , growth theory , industrial organization , macroeconomics , neoclassical economics , market economy , human capital , physics , geometry , mathematics , thermodynamics
I investigate the long‐run implications of trade and technology diffusion through trade, when firms are heterogeneous and trade is costly. This paper integrates firm heterogeneity and trade into a product innovation growth model from endogenous growth theory. I find that although exposure to trade increases average productivity, it has an ambiguous effect on economic growth and consumer welfare.