Costly investment and complementarities in an international trade model with directed technological change

• Type: Article in International Scientific Journal
• Date: 2018

Authors

Óscar Afonso (Author) FEP; Neves, PC (Author) Other; Thompson, M (Author) Other

Journal

Title: Metroeconomica

Vol. 69

Pages: 195-223

ISSN: 0026-1386

Publisher: Wiley-Blackwell

Indexing

ISI Web of Knowledge - 2 Citations

Scopus - 1 Citation

Other information

Authenticus ID: P-00N-CV7

DOI: 10.1111/meca.12176

Abstract (EN): We investigate the impacts on the skill premium and on economic growth in an innovator-imitator general equilibrium growth model assuming: (a) directed technological change; (b) international trade of intermediate goods; (c) internal costly investment in both physical capital and R & D; and (d) complementarities between intermediate goods in aggregate production. With trade of intermediate goods, the complementarities degree and investment costs influence the economic growth of both countries, but do not affect the countries' skill premia, which are directed by technological knowledge. Additionally, in agreement with related empirical literature, openness to trade of intermediate goods leads to a higher equilibrium skill premium in both countries, whereas its impact on the common growth rate can vary in sign.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 29