Jump to ContentJump to Main Navigation
Show Summary Details
In This Section

The B.E. Journal of Economic Analysis & Policy

Editor-in-Chief: Jürges, Hendrik / Ludwig, Sandra

Ed. by Auriol , Emmanuelle / Brunner, Johann / Fleck, Robert / Mendola, Mariapia / Requate, Till / Schirle, Tammy / de Vries, Frans / Zulehner, Christine

4 Issues per year


IMPACT FACTOR 2016: 0.252
5-year IMPACT FACTOR: 0.755

CiteScore 2016: 0.48

SCImago Journal Rank (SJR) 2015: 0.501
Source Normalized Impact per Paper (SNIP) 2015: 0.418

Online
ISSN
1935-1682
See all formats and pricing
In This Section
Volume 8, Issue 1 (Sep 2008)

Issues

Volume 6 (2006)

Volume 4 (2004)

Volume 2 (2002)

Volume 1 (2001)

Growth and Inequality in Closed and Open Economies: The Role of the Product Cycle

Priya Ranjan
  • 1University of California, Irvine,
Published Online: 2008-09-10 | DOI: https://doi.org/10.2202/1935-1682.1938

Abstract

The product cycle literature suggests that new goods have a higher skill intensity in the early phase of production, which declines once the production process becomes standardized. Using this insight it is shown how an increase in the rate of neutral technological progress, which frees up resources tied in the production of existing goods, leads to increased production of skill intensive new goods and consequently an increase in wage inequality. When technological progress is exogenous, a decrease in skill endowment or trade liberalization with a skill scarce country increases wage inequality but leaves the composition of production between new and standardized goods unaltered. When the rate of technological progress depends on research effort, trade between a skill-abundant Northern economy and a skill-scarce Southern economy can raise wage inequality in both countries and increase productivity growth in the latter. North-North trade increases both wage inequality and productivity growth.

Keywords: wage inequality; productivity growth; product cycle; North-South trade

About the article

Published Online: 2008-09-10



Citation Information: The B.E. Journal of Economic Analysis & Policy, ISSN (Online) 1935-1682, DOI: https://doi.org/10.2202/1935-1682.1938. Export Citation

Comments (0)

Please log in or register to comment.
Log in