This paper examines the dynamic implications of international trade in a two-sector overlapping-generations economy with endogenous growth. It analyzes the global dynamics of this model for both a closed economy and a two-country world economy. It shows how international trade can cause the...

This study develops a general equilibrium model in which the evolution of income inequality and output conforms with the Kuznets hypothesis. The paper presents a novel endogenous mechanism that generates the inverted-U relation between income inequality and per capita output, and captures the...