We develop an endogenous growth model with three goods, exportable, importable and non-tradable. We study the response … of the real exchange rate and of the economy growth rate to a decrease in the tariff rate. We show that trade … liberalization must be followed by a depreciation of the real exchange rate. We deduce that the growth rate of the economy increases …

This paper quantifies the welfare cost of consumption externalities in an endogenous growth model with habit formation … past consumption. Although utility may be lower in the presence of consumption externalities, the welfare loss relative to … the efficient growth path is found to be very small. This result is extremely robust to variations in the parameter values …

. It is also demonstrated that per capita consumption may not necessarily be a decreasing function of a growth rate. This …

economic growth model that is capable of generating stable equilibria, cycles, or chaos. This paper confirms stable economic … growth in China in the period 1980 - 2012 (www.imf.org). A key hypothesis of this work is based on the idea that the …