Economic Integration and Endogenous Growth
Luis A. Rivera-Batiz
Universidad de Puerto Rico - Graduate School of Business Administration
Paul M. Romer
National Bureau of Economic Research (NBER)
NBER Working Paper No. w3528
In a world with two similar, developed economies, economic integration can cause a permanent increase in the worldwide rate of growth. Starting from a position of isolation, closer integration can be achieved by increasing trade in goods or by increasing flows of ideas. We consider two models with different specifications of the research and development sector that is the source of growth. Either form of integration can increase the long-run rate of growth if it encourages the worldwide exploitation of increasing returns to scale in the research and development sector.
Number of Pages in PDF File: 36working papers series
Date posted: December 14, 2000
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