International Trade And Economic Growth In Open Economies

"This work will be of great interest to both historians of economic ideas and economists concerned with modelling the interactions between growth and international trade."--BOOK JACKET.

Unlike any other text on international trade, this groundbreaking book focuses on the dynamic long-run relationship between trade and economic growth rather than the static short-run relationship between trade and economic efficiency. The authors begin with well-known theory on international trade, and then take the student into more recent and less well-known work, all with a careful balance between empirical and theoretical perspectives. A valuable teaching tool for courses in international economics, economic growth, and economic development at both the undergraduate and graduate levels, the book uses some very modest algebra, calculus, and statistics. However, most analytical discussions are built around diagrams in order to make the text accessible to students with a variety of social science backgrounds. An Instructor's Manual is available to professors who adopt the text.

Part 1 of this volume focusses on globalization. Gains from trade, international competitiveness, labour market issues in open economies, customs unions, dumping and intra-firm trade are the topics of this part. Part 2 puts a stronger emphasis on dynamic economics. Social income, intergenerational transfers, public pension systems, and bequest and gift motives in overlapping generation models are main topics. Economic policies are analyzed in Part 3, including the relation between wage rigidity and migration, several aspects of German financial and monetary policy, as well as tax competition. The volume concludes with institutional issues of globalization, a western view on eastern transition, social cost of rent seeking, and the evolution of social institutions.

While endogenous growth theory has claimed success in modeling various factors of growth and providing an analysis of sustainable economic growth, most of the growth models in published work are for closed economies. The omission of international trade, which is often regarded as the engine of growth, greatly reduces their usefulness. The theory of international trade, on the other hand, is characterized by models that are mainly static. While interest in the dynamics of trade has been growing, there is still little work in this area. The success of the newly industrialized economies that have adopted trade-oriented policies suggests how limited present trade theory is in explaining and analyzing the growth of these economies. The work collected here serves to bridge the "old" growth theory and "new" growth theory; merge growth and trade theory; suggest new analysis and techniques of economic growth; and provide analysis of new issues related to growth and trade. The first chapter surveys endogenous growth and international trade and critically reviews the endogenous growth theory with a unified framework, covering the work on both closed and open economies. Three chapters examine the dynamics of some basic trade models; two chapters focus on growth and trade with endogenous accumulation of human and public capital; two chapters on economic growth, technological progress, and international trade; and two chapters on growth and international factor movements. Contributors include Eric W. Bond, Theo S. Eicher, Rolf Färe, Oded Galor, Shawna Grosskopf, Bjarne S. Jensen, Pantelis Kalaitzidakis, Shoukang Lin, Ngo Van Long, Kazuo Nishimura, Koji Shimomura, Kathleen Trask, Stephen J. Turnovsky, Pham Hoang Van, Henry Wan, Jr., Chunyan Wang, and Kar-yiu Wong. Bjarne S. Jensen is Associate Professor of Economics, Copenhagen Business School. Kar-yiu Wong is Professor of Economics, University of Washington, Seattle.

Causality and exogeneity between exports and economic growth : the case of Asian NICs -- The chaotic attractor of foreign direct investment : why China? : a panel data analysis -- FDI, exports, and GDP in East and Southeast Asia : panel data versus time-series causality analyses -- FDI, exports, economic growth nexus in first and second generation ANIEs / co-authored with Yongkul Won -- The IT revolution and macroeconomic volatility in newly developed countries : on the real and financial linkages -- The impacts of the U.S. economy on the Asia-Pacific region : does it matter? / co-authored with Akio Yamashita -- Gains from policy coordination between Taiwan and the USA : on the games governments play -- International policy coordination with a dominant player : the case of the United States, Japan, Taiwan, and Korea.

International trade policy is facing a cross-roads. This is creating uncertainty, impairing world economic growth. Unless a policy of more open markets is pursued, protectionism may well turn into a self-perpetuating and cumulative process. This is why the 1986 Kiel Conference was devoted to Free Trade in the World Economy: Towards an Opening of Markets. We felt that such a conference would help to stimulate policy discussion preceding the Uruguay Round under the auspices of the GATT and the moves within the European Community towards completing a common internal market by 1992.

Seminar paper from the year 2006 in the subject Business economics - Miscellaneous, University of Hamburg, language: English, abstract: If the need for a „Big Push“ survives in an economy that is open to international trade and capital movements, or if openness to trade and capital movements is sufficient to overcome all poverty traps, these questions have daunted development economics since its inception (Jaime et al. 1997). In the last two hundred years, every country with high development and productivity rates has industrialised. While in the eighteens century Britain, and in the twenties century Korea and Japan grew rich, other countries remained poor. One of the discussed causes for this underdevelopment might be the small domestic market. While the idea started with Rosenstein-Rodan (1943)1, who thought the solution would be aid and investment programs, since the 1960s advocates tend to the Idea that openness of the economy resolve the problem of a small domestic market. The theory is that openness would induce an export-led „Big Push“ in terms of simultaneous growth over different sectors (Murphy et al.1989, p.1003). In the current discussion the „Big Push“ induced by aid has its comeback in the Millennium Development Goals from the UN (Easterly 2005, p.3). The focus of this paper is on the East Asian countries, where the export-promotion-policy had had an important role. But Trindade (2005, p.41) was the first author who interpreted the coordination-problem as solvable with solely export-promotion, because of the naturally coordination effect of exports (Asche, 2005, p.24 gloss 28). So the question is not if exports are good for an economy, but if exports can induce a „Big Push“ and thus making aid superfluously.