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TRANSPORTATION COSTS AND THE GREAT DIVERGENCE

Published online by Cambridge University Press:  20 May 2014

Leonid V. Azarnert
Leonid V. Azarnert*
Affiliation:
Ariel University and CESifo
*
Address correspondence to: Leonid Azarnert, Department of Economics and Business Administration, Ariel University, Ariel 40700, Israel; e-mail: [email protected].
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Abstract

This work shows the asymmetric effect of the reduction in transportation costs across different sectors in the process of the Great Divergence. Specifically, the analysis indicates that reductions in transportation costs of industrial goods enhance convergence of the growth rates of trading economies. In contrast, reductions in transportation costs of nonindustrial goods contribute to a further divergence across countries.

Keywords

International TradeTrade CostsTransportation RevolutionFertilityEconomic Growth
Type
Articles
Information
Macroeconomic Dynamics , Volume 20 , Issue 1 , January 2016 , pp. 214 - 228
Copyright
Copyright © Cambridge University Press 2014 

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