Using data from 24 OECD countries, we find that the relationship between a country¡¯s R&D investment and technological advantage in a sector (measured by the country¡¯s labor productivity of the sector relative to the rest of the world) is non-monotonic. In particular, for countries whose...

Based on a general setup, this article shows that distance consistently accounts for about 40% of the international trade costs over the years for both developed and developing countries if we assume that trade costs take the iceberg form. The result helps us have a clear perspective of the...

Using the Ricardian model, we formally prove Hicks' [Hicks, John (1953), "An Inaugural Lecture," Oxford Economic Papers 5(2), 117-135.] insight into the effects of technological improvement: uniform technological improvement at home benefits all countries (or at least does not hurt);...

This paper studies the intellectual property protection in a global setting where the protection is based on the patentability requirement. When two countries with similar research efficiencies open trade with each other, the world patentability requirement will rise above the autarky levels of...

This paper applies the inframarginal analysis, which is a combination of marginal and total cost-benefit analysis, to investigate the relationship between division of labor, the extent of the market, productivity, and inequality of income distribution. The model with transaction costs and...