Economic Integration and Endogenous Growth

36 Pages Posted: 14 Dec 2000 Last revised: 11 Apr 2022

See all articles by Luis A. Rivera-Batiz

Luis A. Rivera-Batiz

Universidad de Puerto Rico - Graduate School of Business Administration

Paul M. Romer

National Bureau of Economic Research (NBER)

Date Written: December 1990

Abstract

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.

Suggested Citation

Rivera-Batiz, Luis A. and Romer, Paul M., Economic Integration and Endogenous Growth (December 1990). NBER Working Paper No. w3528, Available at SSRN: https://ssrn.com/abstract=226822

Luis A. Rivera-Batiz (Contact Author)

Universidad de Puerto Rico - Graduate School of Business Administration ( email )

Ponce De Leon Avenue
00931-3300
Puerto Rico

Paul M. Romer

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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