Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/94754 
Year of Publication: 
1998
Series/Report no.: 
IUI Working Paper No. 496
Publisher: 
The Research Institute of Industrial Economics (IUI), Stockholm
Abstract: 
This paper takes a step towards formalizing the theoretical interconnections among four post-Industrial Revolution phenomena - the industrialization and growth take-off of rich 'northern' nations, massive global income divergence, and rapid trade expansion. Specifically, we present a stages-of growth model in which the four phenomena are jointly endogenous and all are trigged by a gradual fall in the cost of doing business internationally. In the first stage, while trade costs are high, industry is dispersed and growth is low. In the second stage, the north industrializes rapidly, growth takes off and the south diverges. In the third stage, high growth becomes self sustaining. The model shows under which conditions, in a fourth stage, the south can quickly industrialize and converge.
Subjects: 
Growth Take-Off
Industrial Revolution
Economic Geography
Endogenous Growth
Trade and Development
JEL: 
F01
F43
N13
O19
Document Type: 
Working Paper

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