This paper investigates Samuelson's (JEP, 2004) argument that technical progress of the trade partner may hurt the home country. We illustrate this prospect in a simple Ricardian model for sitations with outward knowledge spillovers. Within this framework Samuelson's "Act II" effects may occur....

This paper investigates the productivity effects of inward and outward foreign direct investment using industry and country level data for 17 OECD countries over the period 1973 to 2001. Controlling for national and international knowledge spillovers we argue that effects of FDI work through...