Capital and Goods Market Integration and the Inequality of Nations

Wagner, MartinORCID: (June 1999) Capital and Goods Market Integration and the Inequality of Nations. Former Series > Working Paper Series > IHS Economics Series 66


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Abstract: A 2-country model with two groups of agents, workers and capitalists is presented in which economic integration results in an initial phase of catch-up, where the less industrialised country experiences the rise in both capital and labour income. Then, after a certain level of integration has been reached, the less industrialised country is completely de-industrialised. This has detrimental effects on the income of this country's workers, but the capital owners of this country gain from specialisation, as do the workers in the industrialised country. Both the capital and the goods markets are subject to imperfections. The structure of the equilibrium sets during integration is characterised completely.;

Item Type: IHS Series
Keywords: 'Globalisation' 'Trade' 'Market Imperfections' 'Integration'
Classification Codes (e.g. JEL): F12, F15
Date Deposited: 26 Sep 2014 10:36
Last Modified: 14 Jun 2024 11:01

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