ORCID
https://orcid.org/0000-0002-6598-1116
Date of Award
5-6-2025
Degree Name
Doctor of Philosophy (PhD)
Degree Type
Dissertation
Abstract
In the last three decades, the world economy has become increasingly interconnected through multinational production and international trade. This dissertation examines how these factors influence the economic growth of individual countries. The first two chapters study the effect of multinational firms and trade in cross-country knowledge diffusion. The first chapter introduces a novel model of knowledge diffusion with trade and multinational production to analyze their effects on productivity growth across countries. The second chapter develops a method to bring empirical evidence to the intensity of knowledge diffusion. Using the Chinese outward investment promotion that occurred during the year 2004—2006, the result shows that a 1 percentage point increase in multinational firms originating from China leads to a 1.83% increase in the total factor productivity of the recipient country’s sector. We show that this methodology can provide evidence on key parameters in knowledge diffusion models. Counterfactual analysis uncovers the sets of countries that gain and suffer, depending on changes in trade or multinational production costs. The final chapter highlights the role of service trade in economic growth. Focusing on the case of India, I find that modeling services as tradable is crucial in accounting for India's pattern of structural transformation. The model I developed indicates that India's producer services experienced substantial productivity gains relative to the global average. Additionally, estimates indicate that producer services experienced the steepest decline in trade costs over the studied period. These factors drove structural transformation in India and also resulted in shifts towards more productive sectors, increasing allocative efficiency.
Language
English (en)
Chair and Committee
Yongseok Shin
Committee Members
Ana Maria Santacreu; Fernando Leibovici; Francisco Buera; Rodolfo Manuelli
Recommended Citation
Song, Min Young, "Essays on Macroeconomic Growth in an Open Economy" (2025). Arts & Sciences Theses and Dissertations. 3504.
https://openscholarship.wustl.edu/art_sci_etds/3504