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| Author: | Fischer, R. Serra, P. |
| Title: | Income convergence within and between countries |
| Journal: | International Economic Review
1996 : AUG, VOL. 37:3, p. 531-552 |
| Index terms: | INTERNATIONAL ECONOMICS INCOMES |
| Language: | eng |
| Abstract: | The authors study how trade changes the rate of income convergence within and between countries in a model of endogenous growth. An externality in the production of human capital implies that inequality slows down growth under autarky. Eventually incomes converge, raising the growth rate. Trade accelerates (slows down) growth and the rate of income convergence in the poor (rich) country. In the long run trade ensures that countries grow at the same rate and that the ration of their incomes tends to 1. |
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