Abstract
Since the late 1980s, trade theorists have been aware that trading opportunities and trade policy can have important, and lasting, effects on a nation’s rate of economic growth. Conversely, since the time of Edgeworth, Mill and Ricardo trade economists have been studying the consequences of ongoing improvements in technology and growth of factor endowments for trading opportunities and trade policy. I follow this division of labour by specializing this review in a similar, and, I hope, complementary manner. The first goal of this chapter is to synthesize the major theoretical results from the new growth theory linking international trade and trade policy to permanent and lasting effects on growth rates. The second goal is to study how the consequences of ongoing endogenous growth may affect the incentives governments have to restrict trade at a point in time, and how endogenous growth can shape and limit the form of self-enforcing trade liberalizations that are supportable over time.
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© 1999 International Economic Association
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Taylor, M.S., Vousden, N. (1999). Trade and Trade Policy in Endogenous Growth Models. In: Piggott, J., Woodland, A. (eds) International Trade Policy and the Pacific Rim. International Economic Association Series. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-14543-0_15
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DOI: https://doi.org/10.1007/978-1-349-14543-0_15
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