Leisure time, savings and trade patterns - A two-country growth model

This paper proposes a simple two-country endogenous growth model with endogenous consumption, leisure time and wealth accumulation. The model examines possible causes for the world economic growth and the existence and persistence of trade patterns between countries with different preferences and human capital under internationally free capital mobility. We show how differences in preferences in consumption, leisure time and wealth between the two countries may affect long-run world economic growth.