This paper presents a dynamic general equilibrium model of trade between two advanced countries in which both innovation and skill acquisition rates are endogenously determined. The model offers a North-North (as opposed to a North-South) trade explanation for increasing relative wage...

We reassess Mankiw, Romer and Weil's [mrw] version of the Solow model using, as did mrw, cross-sectional data to estimate the steady-state equation governing income per capita levels. The model fails in two critical areas. First, plausible factor shares obtained by mrw are not robust to the...