Quality, trade, and growth
Document Type
Journal article
Source Publication
Journal of Economic Behavior & Organization
Publication Date
10-1-2004
Volume
55
Issue
2
First Page
271
Last Page
291
Keywords
Extent of the market, Growth, Heterogeneity of human capital, Quality
Abstract
This paper analyzes the roles of product quality and increasing returns in international division of labor and economic development. Because the qualities of different intermediate goods are highly complementary in producing the quality of the final good, a poor economy will choose to be in autarky if its average level of human capital is sufficiently low. Thus, the heterogeneity of human capital may hamper the division of labor. Further, by linking quality, trade and growth, this model simultaneously explains the East Asian Miracle and the empirical finding of conditional convergence.
DOI
10.1016/j.jebo.2003.09.011
Print ISSN
01672681
Publisher Statement
Copyright © 2014 Elsevier B.V.
Access to external full text or publisher's version may require subscription.
Full-text Version
Publisher’s Version
Language
English
Recommended Citation
Fan, C. S. (2004). Quality, trade, and growth. Journal of Economic Behavior & Organization, 55(2), 271-291. doi: 10.1016/j.jebo.2003.09.011