Technological progress and market growth: An empirical study based on the quality-ladder approach

This paper develops an extended version of the quality-adder model by allowing for heterogeneous markets. Based on this model, it presents an empirical analysis of innovation-based growth at the market level using a technometric measurement concept. It can be shown that a growth-promoting effect due to technological progress in a particular single year is observed after between 2 and up to 7 years. This is true not only for highly innovative markets but also for those in which fewer R&D resources are invested.     

Trade and the Euro: effects on bystanders

This article investigates trade effects of the euro focusing on the impact on bystanders. We use data for Swedish firms and examine the impact on exporting firms’ intensive and extensive margins of trade. Our result shows an overall increase in Swedish firms’ exports to the euro area after the introduction of the single currency, indicating that the euro has decreased trade costs also for outsiders. In addition, we find important heterogeneity in the sample, suggesting that it is the large majority of small firms that has increased trade flows with the Eurozone the most.     

On the growth and welfare effects of monopolistic distortions

The most fundamental proposition about growth and competition is that there is a tradeoff between static welfare and long-term growth. This paper reconsiders this basic proposition in an expanding variety endogenous growth model with competitive markets for “old” innovative products and for a traditional good. We shed light on some implications of monopolistic distortions which tend to be ignored by standard models. First, no growth may be better than some growth, since modest positive growth potentially requires sizeable static welfare losses. Second, the economy may converge to a steady state with zero growth, even though a locally saddle-point stable steady state with positive growth exists if the initial share of “cheap” competitive markets is sufficiently high, as this implies a relatively low demand for “expensive” innovative goods. Third, such a “no-growth trap” may happen in a world economy made up of several countries engaged in free trade with each other. The policy implications are that growth-enhancing policies may be misguided and that quick deregulation as well as quick trade liberalization can lead to stagnation in the long term.      

Free Trade, Growth, and Convergence

Can trade liberalization have a permanent affect on output levels, and more important, does it have an impact on steady-state growth rates? The model emphasizes the role that knowledge spillovers emanating from heightened trade can have on income convergence and growth rates during transition and over the long run. Among the results of the model, unilateral liberalization by one country reduces the income gap between the liberalizing country and other, wealthier countries. From the long-run growth perspective, unilateral (and multilateral) liberalization generates a positive impact on the steady-state growth of all the trading countries.     

Economic Deregulation and Trade Liberalization in Kenya,Tanzania and Uganda: Growth and Poverty

With economic growth as a principal target, Kenya, Tanzania and Uganda have implemented deregulation and trade liberalization policies. By tracing the trends in major economic aggregates, the progress of these economies is reviewed. While acknowledging the conceptual arguments supporting the measures adopted, constraints in both the international economy and domestically have resulted in disappointing outcomes. International trade rules and practices, particularly in the agricultural sector, have worked against all three countries. Moreover, their domestic economies lack crucial resources. The results suggest that it may be a long time before the deregulation policies lead to a reduction in poverty.     

Strategic policies and growth: an applied model of R&D-driven endogenous growth

We introduce and explore a general equilibrium model with R&D-driven endogenous growth, whose antecedents are the models of Romer (1990) [Romer, P.M., 1990. Endogenous technological change. Journal of Political Economy, 98, S71-102] and Grossman and Helpman (1991) [Grossman, G.M., Helpman E., 1991. Innovation and Growth in the Global Economy, The MIT Press, Cambridge]. Utilizing evidence from recent econometric studies on sources of growth, the model also accounts explicitly for cross-border technological spillovers. The model is specified and calibrated to data from Japan, and is solved to obtain both the transitional and the steady-state equilibria. We explore the effects of selective trade and R&D promotion policies on long-run growth and social welfare. The model results suggest that while a strategic trade policy has little effect on re-allocating resources into domestic R&D activities, it can significantly affect the cross-border spillovers of technological knowledge, which, in turn, stimulates growth. We find that trade liberalization may cause the growth rate to fall and lead to a loss of social welfare in the long-run, although it improves welfare in the short-run. R&D promotion policies stimulate growth by inducing private agents to allocate more resources to domestic R&D, as well as to take greater advantage of global R&D spillovers. Here, we find significantly high growth effects together with sizable gains in social welfare at low incidence to tax payers.     

全球贸易自由化下的环境问题与环境政策

在全球贸易自由化的进程中,对环境既产生了正的影响,也产生了负的影响。但贸易不是产生环境问题的根源,所以不能靠制定与贸易有关的环境政策来解决,而应当在环境污染的发生地实施有关的环境政策,使“外部化”了的费用,纳入生产者的成本中,这才是真正的贸易比较优势。     

异质性企业贸易理论的起源与发展

本文旨在系统性地探究异质性企业贸易理论的起源与发展过程。首先对促使该理论诞生的实证挑战从企业的选择性出口、市场进入成本、资源再分配三个方面进行了综述;然后指出该理论发展的两条脉络和各自的理论基础,并在此基础上从平均生产率和贸易利得两个角度阐述了异质性企业贸易理论和新贸易理论之间的紧密联系,二者最大的差别便在于对边际生产成本的处理上,前者以边际成本的异质性替代企业的异质性,后者则忽略了企业之间的异质性。同时,针对国内学者的一些认识,本文也提出了自己的看法。     

Critical survey. Endogenous growth theory: a critical assessment

A critical assessment is made of endogenous growth theory fromthe perspective of recent developments within economics as adiscipline. These include its increasing mathematical formalisation,its focus upon microfoundations, the casual use of econometricsto test models, and the incorporation of factors that have traditionallybeen outside mainstream economics. It is found that the theoryfocuses upon market imperfections and technological progressin a variety of ways, and reconstructs their impact upon themacroeconomy as a growth rather than as a level effect. Whilstthe growth rate is endogenised, this leads to the problem ofmultiple equilibria and extremely complex dynamics. The generalisationfrom exogenous growth theory is, however, associated with evenmore extreme assumptions and analytical distance from the socioeconomicprocesses of growth itself.     

Analysing Potential Effects of Preferential Liberalisation in Some Asian Emerging Economies

This paper examines the ex-ante effects of possible trade liberalisation of some Asian emerging economies through forming a regional economic bloc called BIMSTEC by adopting SMART and GTAP models. Based on estimated export supply elasticity, the results of SMART simulation reveal that the highest net trade effect takes place for India, the biggest economy in the bloc, followed by Bangladesh for tariff elimination. The two countries also derive substantial welfare gains. The proportionate revenue loss is remarkably higher for smaller countries such as Nepal, Myanmar and Bangladesh. GTAP simulation suggests that Bangladesh incurs a net welfare loss by joining the FTA. The overall intra-bloc export is likely to increase. These results imply that there is a need for designing proper compensation mechanism and technical support for the smaller economies to offset the possible adverse effects.     

Trade imbalance and the endogenous optimal tariff

Endogenous tariff literatures reveal empirically that trade imbalance is negatively related with import tariff, this article gives a theoretical evidence and explanation to support this finding with the methodology of multi-country numerical general equilibrium modelling and simulation. We explore how optimal tariff changes after trade imbalance is introduced, and find that optimal tariffs decrease substantially, either for surplus or deficit countries, when imbalance is considered. Specifically, when the imbalance is modelled in endogenous monetary and inside-money structures, the optimal tariffs decrease by 26% globally on average. Our results suggest that the deepening trade imbalance is beneficial to the global trade liberalization due to its driving tariffs down.     

Quality heterogeneity and global economic growth

This paper develops a fully endogenous, variety-expansion growth model with firm-specific quality heterogeneity, limit pricing, and an endogenous distribution of markups. Firms with high-quality products engage in exporting, firms with intermediate-quality products serve the domestic market, and inefficient firms with low-quality products exit the market. Trade liberalization, measured by a reduction in trade costs or a decline in foreign market entry costs, generates a reallocation of resources from low-quality to high-quality products and exit of inefficient firms. However, it has ambiguous effects on the average global quality level, long-run growth, and welfare. An increase in the rate of population growth or in the intensity of trade-related knowledge spillovers accelerates economic growth. The laissez-faire equilibrium is inefficient, and this leaves room for welfare-improving government intervention.     

Are Larger Merger Synergies Bad News for Consumers? Endogenous Post‐Merger Internal Organization

In this paper, we endogenize the post‐merger internal organization of firms, considering two alternative structures: multidivisional, in which separate divisions are kept, and traditional, with cost synergies. We analyze when each structure occurs in equilibrium and how it affects welfare. We show that higher synergies do not necessarily lead to higher consumer surplus: firms can opt for a merger type that does not increase consumer surplus as much as the one that would occur with lower synergies. This highlights the importance of antitrust authorities basing their decisions not just on the magnitude of eventual synergies but also on the post‐merger organizational form.