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dc.contributor.authorLong, Ngo Vanen_US
dc.contributor.authorRaff, Horsten_US
dc.contributor.authorStähler, Franken_US
dc.date.accessioned2009-01-28T15:00:11Z-
dc.date.available2009-01-28T15:00:11Z-
dc.date.issued2008en_US
dc.identifier.urihttp://hdl.handle.net/10419/17893-
dc.description.abstractThis paper examines how trade liberalization affects the innovation incentives of firms, and what this implies for industry productivity and social welfare. For this purpose we develop a reciprocal dumping model of international trade with heterogeneous firms and endogenous R&D. We identify two effects of trade liberalization on productivity: a direct effect through changes in R&D investment, and a selection effect due to inefficient firms leaving the market. We show how these effects operate in the short run when market structure is fixed, and in the long run when market structure is endogenous. Among the robust results that hold for any market structure are that trade liberalization (i) increases (decreases) aggregate R&D for low (high) trade costs; (ii) increases expected industry productivity; and (iii) raises expected social welfare if trade costs are low.en_US
dc.language.isoengen_US
dc.publisherKiel Institute for the World Economy (IfW) Kielen_US
dc.relation.ispartofseriesKieler Arbeitspapiere 1430en_US
dc.subject.jelF12en_US
dc.subject.jelF15en_US
dc.subject.ddc330en_US
dc.subject.keywordinternational tradeen_US
dc.subject.keywordfirm heterogeneityen_US
dc.subject.keywordR&Den_US
dc.subject.keywordproductivityen_US
dc.subject.keywordmarket structureen_US
dc.subject.stwAußenhandelsliberalisierungen_US
dc.subject.stwInnovationen_US
dc.subject.stwProduktivitäten_US
dc.subject.stwIndustrielle Forschungen_US
dc.subject.stwEndogener technischer Fortschritten_US
dc.subject.stwWohlfahrtseffekten_US
dc.subject.stwTheorieen_US
dc.titleInnovation and Trade with Heterogeneous Firmsen_US
dc.typeWorking Paperen_US
dc.identifier.ppn571523293en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
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Kieler Arbeitspapiere, IfW

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