Effects of export subsidies in an endogenous growth model with transport costs and firm location
DOI:
https://doi.org/10.17811/ebl.14.3.2025.156-165Keywords:
Export subsidies, endogenous growth, transport costs, firm locationAbstract
This paper analyzes the impact on world growth of an increase in export subsidies in one country based on an open economy endogenous growth model in which there are transportation costs and the movement of firms across international borders. In contrast to the negative effect of export subsidies on world growth in the open economy endogenous growth model without transportation costs and the movement of firms, the paper shows that an increase in export subsidies in one country increases world growth under a certain condition.
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