We build an overlapping generations model of endogenous growth driven by human capital formation. Young people differ in their innate abilities, but these differences are not known even by the individuals themselves when they are going through the process of education, so that there are no...

We show that the Kemp-Wan proposition concerning the formation of customs union holds under conditions of imperfect competition and increasing returns.

This paper introduces a new duality concept, factor income function, in order to establish the factor Price Equalization theorem and the Heckscher-Ohlin theorem in an oligopolistic Heckscher-Ohlin model with increasing returns to scale.

We formulate a two-country endogenous growth model which explain joint determination of long-run trade patterns and world growth rates. After providing the existence and local stability of the continuum of balanced growth paths, we show that main standard trade propositions hold under some...

The theory of involuntary international transfers (war indemnities) has been constructed on the assumption that the donor and recipient are completely indifferent to each other's well-being. The assumption is hard to justify since usually the transfers closely follow periods during which the...

PTAs are generally negotiated without any tariff concessions or transfers to non-member countries. Can such a PTA benefit the neighbors' welfare? In a two-good competitive equilibrium model in the absence of an entrepot, a PTA without concessions to the outsider will hurt the outsider's welfare...