This paper investigates the dynamic effects of international trade using an endogenous growth model that incorporates learning by doing, which, although bounded in each good, exhibits spillovers across goods. The study compares the growth and technical progress of a Less Developed Country (LDC) and a Developed Country (DC) under autarky and free trade. Under free trade, the LDC experiences rates of technical progress and GDP growth less than or equal to those under autarky, while the DC experiences rates greater than or equal to those under autarky. This implies that the LDC faces dynamic losses from trade, while the DC experiences dynamic gains. However, technical progress abroad can improve welfare at home, so LDC consumers may enjoy higher intertemporal utility along the free trade path. DC consumers, as long as their economy is not overtaken by the LDC, will experience both more rapid technical progress and traditional static gains from trade, leading to an unambiguous improvement in intertemporal welfare. The paper also examines the dynamic effects of international trade on growth and technical progress. It finds that under free trade, the DC experiences faster technical progress at the expense of the LDC. The study highlights that the LDC's comparative advantage, while statically optimal, has detrimental effects on its rate of technical progress. The DC's technical progress is driven by its ability to continue learning by doing in more advanced industries, while the LDC's learning by doing slows as it exhausts its technical capabilities. The paper also discusses the role of spillovers in learning by doing and the implications of bounded learning by doing for long-run growth. It concludes that the DC experiences dynamic gains from trade, while the LDC experiences dynamic losses, and that the relative wage and population size of the two economies play a crucial role in determining the trade equilibrium. The study emphasizes the importance of considering the dynamic effects of trade on growth and technical progress, as well as the implications for intertemporal welfare.This paper investigates the dynamic effects of international trade using an endogenous growth model that incorporates learning by doing, which, although bounded in each good, exhibits spillovers across goods. The study compares the growth and technical progress of a Less Developed Country (LDC) and a Developed Country (DC) under autarky and free trade. Under free trade, the LDC experiences rates of technical progress and GDP growth less than or equal to those under autarky, while the DC experiences rates greater than or equal to those under autarky. This implies that the LDC faces dynamic losses from trade, while the DC experiences dynamic gains. However, technical progress abroad can improve welfare at home, so LDC consumers may enjoy higher intertemporal utility along the free trade path. DC consumers, as long as their economy is not overtaken by the LDC, will experience both more rapid technical progress and traditional static gains from trade, leading to an unambiguous improvement in intertemporal welfare. The paper also examines the dynamic effects of international trade on growth and technical progress. It finds that under free trade, the DC experiences faster technical progress at the expense of the LDC. The study highlights that the LDC's comparative advantage, while statically optimal, has detrimental effects on its rate of technical progress. The DC's technical progress is driven by its ability to continue learning by doing in more advanced industries, while the LDC's learning by doing slows as it exhausts its technical capabilities. The paper also discusses the role of spillovers in learning by doing and the implications of bounded learning by doing for long-run growth. It concludes that the DC experiences dynamic gains from trade, while the LDC experiences dynamic losses, and that the relative wage and population size of the two economies play a crucial role in determining the trade equilibrium. The study emphasizes the importance of considering the dynamic effects of trade on growth and technical progress, as well as the implications for intertemporal welfare.