Revised and updated for the 2nd edition, this textbook guides the reader towards various aspects of growth and international trade in a Diamond-type overlapping generations framework. Using the same model type throughout the book, timely topics such as growth with bubbles, robots and involuntary unemployment, financial integration and house price dynamics, policies to mitigate climate change and the persistence of religion in a globalized market economy are explored. The first part starts from the "old" growth theory and bridges to the "new" growth theory (including R&D and human capital approaches). The second part presents an intertemporal equilibrium theory of inter- and intra-sectoral trade, investigates innovation, growth and trade and limits to public debt as well as nationally and internationally optimal climate policies. The debt dynamics of the Euro Zone and the origins of intra-EMU and Asian-US trade imbalances are also explored. The book is primarily addressed to upper undergraduate and graduate students wishing to proceed to the analytically more demanding journal literature.

Autorentext

Karl Farmer is a professor emeritus and former head of the department of economics at the University of Graz (Austria). His current research addresses limits to public debt under involuntary unemployment, global climate policy and the effects of robots and digitalization on employment by means of the Overlapping Generations approach. He is author of many books and articles in established journals as Economic Theory, Economic Modeling, Journal of Economics, Resource and Environmental Economics, International Review of Economics and International Economic Journal among others. Matthias Schelnast is a former lecturer for macro, micro, and international economics at the department of economics at the University of Graz. His research focuses on public debt and optimal debt reduction.

Inhalt

Growth and International Trade: Introduction and Stylized Facts.- PART I. GROWTH.- Modeling the Growth of the World Economy: The Basic Overlapping Generations Model.- Steady State, Factor Income, and Technological Progress.- Economic Growth and Public Debt in the World Economy.- "New" Growth Theory and Knowledge Externalities in Capital Accumulation.- Endogenous Technological Progress and Infinite Economic Growth.- Human Capital, Religion, and Economic Growth.- Economic Growth With Bubbles.- Involuntary Unemployment in an OLG Growth Model with Public Debt and Human Capital.- Robots, Human Capital Investment, Welfare, and Unemployment in a Digital World Economy.- PART II. INTERNATIONAL TRADE. International Parity Conditions in a Two-Country OLG Model Under Free Trade.- Factor Proportion, Inter-Sectoral Trade, and Product Life Cycle.- Product Differentiation, Decreasing Costs, and Intra-sectoral Trade.- Globalization, Capital Accumulation, and Terms of Trade.- Innovation, Growth and Trade in a Two-Country OLG Model.- Real Exchange Rate and Public Debt in a Two-Advanced-Country OLG Model.- Public Debt Reduction in Advanced Countries and Its Impacts on Emerging Countries.- External Balance, Dynamic Efficiency and Welfare Effects of National Climate Policies.- Nationally and Internationally Optimal Climate Policies.- Modeling the Debt Mechanics of the Euro Zone.- Financial Integration and House Price Dynamics in an OLG Model with Intra-EMU and Asian-US Trade Imbalances.- Why Religion Might Persist in a Globalized Market Economy.