Globalization and Growth
- (pp. 100-104)
AbstractHow does globalization affect economic growth? We discuss mechanisms that link international integration to the incentives for knowledge accumulation and the efficacy of that process. First, integration facilitates the flow of knowledge across national borders. Second, integration affords innovators a larger potential market even as it subjects them to additional competition from foreign rivals. Third, integration encourages specialization according to comparative advantage. Finally, integration affects the incentives for technological diffusion. Taken together, the literature offers many theoretical insights. Some progress has also been made on the empirical side, although data and methodological impediments have left assessment and measurement lagging behind.
Citation2015. "Globalization and Growth." American Economic Review, 105(5): 100-104. DOI: 10.1257/aer.p20151068
- E23 Macroeconomics: Production
- F62 Economic Impacts of Globalization: Macroeconomic Impacts
- O33 Technological Change: Choices and Consequences; Diffusion Processes
- O41 One, Two, and Multisector Growth Models