On endogenous growth: the implications of environmental externalities

A study was conducted on the interaction between trade, economic development and the environment using an endogenous growth model. The results indicate that the effect of trade on growth depends on the relation between factor intensities of exportable, importable and R&D and the factor R&D uses more intensively. The long-term rate of economic development changes with environmental externalities depending on the intertemporal elasticity of substitution.