This paper examines the effects of international income transfers on capital accumulationand welfare in a one-sector overlapping generations model. It is shown that a strong form ofthe transfer paradox – in which the donor country experiences a welfare gain while therecipient country...

This paper explores the role of arbitrary assumptions regarding dimension and thetradeability of capital in neoclassical growth models. It is shown that international marketsfor physical and financial capital are required to reproduce the competitive world growthpath only when the number of...

This paper examines the dynamic effects of international commodity trade by mergingtwo benchmark environments, namely, the static factor endowments model and theneoclassical growth model. Two main questions are asked. First, how does commoditytrade affect the capital-accumulation paths of two...