IMPACT OF INTERNATIONAL TRADE ON ECONOMIC GROWTH
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WPŁYW HANDLU ZAGRANICZNEGO NA WZROST GOSPODARCZY
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The aim of the article is to explain how the international trade impacts the level of economic growth both in the short and long term. At first the analysis deals with few versions of the Factor Endowment Theory and the reasons for its poor empiric evidence are theoretically explained. The Integrated Equilibrium technique is used to account for all the supply side motives to trade, which thanks to D.R. Davis theory of intra-industry trade, is possible. From this analysis arises the fact that trade generated by endowment differentials will never find its clear representation in aggregated macroeconomic statistical figures, because it is drowned in a larger entity of trade motivated by the need for differentiation. Only when there is no trade at all or it is very insufficient the endowments theory can be useful to create some new streams of trade. These facts are present already in the established theory but some new technical solutions and irrefutable explanations are contributed. In the light of the above-mentioned limitations the initial model of P.R. Krugman inspired by the well known formula of A.K. Dixit and J. Stiglitz for the diversity motivated trade is developed. It is generalized by extending its basics outside the unique factor used by P.R. Krugman, which is the labor, in order to cover all the factors and save some of the endowments theory logic, but the need to use rather a Cobb-Douglas type function has been confirmed. The attempt of P.R. Krugman to consider all goods as perfectly symmetric against the utility function has been proven definitely feasible, and a precondition to express the utility function désormais in monetary units. This turn allowed the author to deliver its main contribution by setting a formal model explaining how the international (and for obvious reasons also the inter-regional in case of huge countries) trade impacts the level of economic growth. To contour the limitations of the proposed model, the long-term impacts of trade have been presented based on the New Economic Geography (of the above-mentioned author) with own contribution about the non-labor dependent sectors belonging to the second sector category. The main conclusion is that at the given moment of the economic history the growth of an economy is strictly bonded to its international and inter-regional trade, and this can be used to combat downturns. But, at the same time there happens a differentiation in the level of economic development in the longer term between the countries and regions, which process is however decreasing, thanks to the development and modernization of the second sector’s industries. JEL classification codes: C01, C02, E17, E60, F11, F12, F13, F42, F43, F44, F47.
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