small relative share of R&D in GDP. The paper uses insights from recent dynamic theories of trade to explain these three … contributed to Austria's post-war growth and the evolution of its pattern of trade over time. The paper looks at two lessons for … the Austrian experience, industrial and trade policy for economies in transition is discussed. …

We set up a simple trade model with two countries hosting one firm each. The firms invest in cost-reducing R&D, and … R&D subsidies the lower the level of trade costs, even if the firms are independent monopolies. If firms produce …