This paper examines the inherent link between a countryís education system and its comparative advantage in trade. It suggests that di§erences in education systems across countries are probably a stable equilibrium result that is compatible with and reinforced by trade patterns. In equilibrium, two distinct types of countries emerge, one that exports creativity-intensive products and has an education system encouraging diversity (as illustrated by the US), and the other one that exports high-quality manufactured products and has an education system promoting homogeneity in student quality (as illustrated by Japan). Our Öndings present a novel explanation for the coexistence of low test scores of students and high economic performance in the US.
Education System, Trade Pattern, Talent Distribution.
Higher Education | International Economics
CHANG, Pao Li and HUANG, Fali.
Education and Trade. (2008). Research Collection School Of Economics.
Available at: http://ink.library.smu.edu.sg/soe_research/1217
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