We develop a monopolistic competition model to investigate effects of international technological convergence on factor rewards, output composition, and welfare. Comparative static analysis indicates technological convergence improves the follower'sbut impairs the leader'sinternational...

Many argued during the NAFTA debate that trade liberalization would favor Mexican over U.S. food processors, especially because of lax environmental laws south of the border. We find through an examination of profit functions that productivity growth in Mexico has outstripped that in the United...