Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/93424
Authors: 
Azarnert, Leonid V.
Year of Publication: 
2014
Series/Report no.: 
CESifo Working Paper 4583
Abstract: 
This article presents a Ricardian model of trade with learning-by-doing to study the effect of barriers to trade in products with low growth potential on the long-run economic growth. The model shows that, when elasticity of demand for the product with a lower learning potential is lower than unitary, a reduction in the tariff imposed on this product, may shift the demand toward the product with a higher learning potential, thus enhancing economic growth in the exporter economy. Therefore, the current trend of reduction in tariffs on agricultural exports not only generates a positive welfare effect in the short run, but may similarly be beneficial for developing economies in the long run, since it also increases their incentive to develop sectors with higher growth potential.
Subjects: 
trade barriers
agricultural export
learning-by-doing
JEL: 
F11
F15
F41
O41
Q17
Document Type: 
Working Paper

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