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Long-Run Comparative Advantage and Transitional Dynamics after Free Trade in an Endogenous Growth Model

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Authors
Kwark, NohSun
Issue Date
2005
Publisher
Seoul Journal of Economics
Citation
Seoul Journal of Economics 18 (No. 2 2005): 173-204
Keywords
Long-run comparative advantage; Endogenous growth; Transitional Dynamics; Capital Accumulation
Abstract
This paper examines the determinants of long-run comparative advantage and analyzes transitional dynamics after free trade in an endogenous growth model. It shows that a country with favorable conditions for capital accumulation has a long-run comparative advantage in capital-intensive goods. Transitional dynamics shows that the growth rate of a more patient country tends to be higher while a less patient country experiences a slowdown in its output growth rate during the transition path. In this study, it is shown that an endogenous growth model with international trade can produce the three empirically observed facts in the rapidly growing East Asian countries: high savings rates, high growth rates, and a significant change in the trade pattern.
ISSN
1225-0279
Language
English
URI
http://hdl.handle.net/10371/1336
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College of Social Sciences (사회과학대학)Institute of Economics Research (경제연구소)Seoul Journal of EconomicsSeoul Journal of Economics vol.18(2) (Summer 2005)
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