Arbeitspapier

Globalization and strategic research investments

We develop a general equilibrium model of international trade with heterogeneous firms, where countries can invest into basic research to improve their technological potential. These research investments tighten firm selection and raise the average productivity of firms in the market, thereby implying lower consumer prices and higher welfare. In an open economy, there is also a strategic investment motive since a higher technological potential gives domestic firms a competitive advantage in trade. Countries tend to over-invest due to this strategic motive. There are thus welfare gains from coordinating research investments. The over-investment problem turns to an under-investment problem if there are sufficiently strong cross-country spillovers of basic research investments.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 5405

Klassifikation
Wirtschaft
Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
Trade Policy; International Trade Organizations
Thema
public research investments
public R&D
international trade
heterogeneous firms
basic research
strategic trade policy

Ereignis
Geistige Schöpfung
(wer)
Bohnstedt, Anna
Schwarz, Christian
Suedekum, Jens
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2010

Handle
Letzte Aktualisierung
10.03.2025, 11:43 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Bohnstedt, Anna
  • Schwarz, Christian
  • Suedekum, Jens
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2010

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