TY  - JOUR
AU  - Grossman,Gene M.
AU  - Helpman,Elhanan
TI  - Trade, Knowledge Spillovers, and Growth
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 3485
PY  - 1991
Y2  - August 1991
UR  - http://www.nber.org/papers/w3485
L1  - http://www.nber.org/papers/w3485.pdf
N1  - Author contact info:
Gene M. Grossman
International Economics Section
Department of Economics
Princeton University
Princeton, NJ 08544
Tel: 609/258-4823
Fax: 609/258-1374
E-Mail: grossman@princeton.edu

Elhanan Helpman
Department of Economics
Harvard University
1875 Cambridge Street
Cambridge, MA 02138
Tel: 617-495-4690
Fax: 617-495-7730
E-Mail: ehelpman@harvard.edu
AB  - In this paper, we examine one channel through which the trade regime might affect growth in the long run. We model endogenous technological progress that results from profit maximizing investments by far-sighted entrepreneurs. Productivity in the research lab depends upon the "stock of knowledge capital", a variable reflecting the state of scientific, engineering and industrial know-how in the local economy. We argue that local knowledge capital is likely to vary positively with the extent of contact between domestic agents and their counterparts in the international research and business communities, and that the number of such contacts increases with the level of commercial exchange. We derive the implications of this for the relationship between trade and growth.
ER  -