The Effect of Transition from Autarky to Free Trade on the Income Gapbetween Two Countries

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This study extends a closed economy, semi-endogenous growth model into an open economy, two-country model to investigate the relationship between trade patterns and growth rates of per capita consumption and the income gap between two countries. As a result, it finds that the relationship between the growth rate of population and that of per capita consumption is different in autarky and free trade.