Hostname: page-component-78c5997874-j824f Total loading time: 0 Render date: 2024-11-20T00:44:18.975Z Has data issue: false hasContentIssue false
  • English
  • Français

TECHNOLOGY ADOPTION DURING THE PROCESS OF DEVELOPMENT: IMPLICATIONS FOR LONG-RUN PROSPECTS

Published online by Cambridge University Press:  27 July 2017

Verónica Mies
Verónica Mies*
Affiliation:
Pontificia Universidad Católica de Chile
*
Address correspondence to: Verónica Mies, Pontificia Universidad Católica de Chile, Vicuña Mackenna 4860, Macul, Santiago, Chile; e-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

Most papers studying the impacts of technology adoption on income trajectories assume that firms adopt frontier technologies when available. If these technologies are skill intensive, less-developed economies may fail in successfully implementing them and may become trapped in a low-growth equilibrium. Within a Schumpeterian growth model, we show that differences in adoption barriers and incentives to the accumulation of skills produce differences in the technology level that is optimal to adopt. If the economy is not overly distorted, copying nonfrontier technologies helps compensating for the scarcity of skills and increases the likelihood of copying frontier technologies in the long run. If distortions are significant, it may be optimal to copy less-advanced technologies even in the long run. If adoption is not a skill-intensive activity, then copying frontier technologies is always optimal; all economies achieve a high-growth equilibrium and only income differences persist in the long run.

Keywords

R&D InvestmentTechnology AdoptionGrowth and DevelopmentTechnology ChoiceConvergence and PolarizationTransitional Dynamics
Type
Articles
Information
Macroeconomic Dynamics , Volume 23 , Issue 3 , April 2019 , pp. 907 - 942
Copyright
Copyright © Cambridge University Press 2017 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

I would like to thank participants at the North American Summer Meeting of the Econometric Society and the EEA/ESEM Meetings. I would also like to thank Rodrigo Fuentes, Andrea Repetto, Raimundo Soto, the editor and one anonymous referee for helpful comments and suggestions. I also acknowledge financial support from VRI-Inicio (INICIO 42/2014) and the National Fund for Science and Technology of Chile Fondecyt, grant number 1150433. The usual disclaimer applies.

References

REFERENCES

Acemoglu, Daron, Aghion, Philippe, and Zilibotti, Fabrizio (2003) Vertical integration and distance to frontier. Journal of the European Economic Association 1 (2–3), 630–638.Google Scholar
Acemoglu, Daron, Aghion, Philippe, and Zilibotti, Fabrizio (2006) Distance to frontier, selection, and economic growth. Journal of the European Economic Association 4 (1), 37–74.Google Scholar
Acemoglu, Daron and Zilibotti, Fabrizio (2001) Productivity differences. Quarterly Journal of Economics 116, 563–606.Google Scholar
Aghion, Philippe, Howitt, Peter, and Mayer-Foulkes, David (2005) The effect of financial development on convergence: Theory and evidence. Quarterly Journal of Economics 120 (1), 173–222.Google Scholar
Aghion, Philippe and Howitt, Peter (2008) The Economics of Growth. Cambridge, MA: MIT Press.Google Scholar
Azariadis, Costas and Drazen, Allan (1990) Threshold externalities in economic development. Quarterly Journal of Economics 105 (2), 501–526.Google Scholar
Barro, Robert J. and Sala-i-Martin, Xavier (1992) Convergence. Journal of Political Economy 100, 223–251.Google Scholar
Barro, Robert J. and Sala-i-Martin, Xavier (1995) Economic Growth. New York: McGraw-Hill.Google Scholar
Barro, Robert and Lee, Jong-Wha (2013) A new data set of educational attainment in the world, 1950–2010. Journal of Development Economics 104, 184–198.Google Scholar
Bartel, Ann P. and Lichtenberg, Frank R. (1987) The comparative advantage of educated workers in implementing new technology: Some empirical evidence. Review of Economics and Statistics 69 (1), 1–11.Google Scholar
Basu, Susanto and Fernald, John (1997) Returns to scale in U.S. production: Estimates and implications. Journal of Political Economy 105 (2), 249–283.Google Scholar
Basu, Susanto and Weil, David N. (1998) Appropriate technology and growth. Quarterly Journal of Economics 113, 1025–1054.Google Scholar
Becker, Gary and Barro, Robert (1989) Fertility choice in a model of economic growth. Econometrica 76, 481–501.Google Scholar
Becker, Gary, Murphy, Kevin, and Tamura, Robert (1990) Knowledge, fertility, and economic growth. Journal of Political Economy 98 (5), S12–37.Google Scholar
Benabou, Roland (1996) Equity and efficiency in knowledge investment: The local connection. Review of Economic Studies 63 (2), 237–264.Google Scholar
Benhabib, Jess and Spiegel, Mark M. (1994) The role of human capital in economic development: Evidence from aggregate cross-country data. Journal of Monetary Economics 34, 143–173.Google Scholar
Caselli, Francesco and Coleman, Wilbur John (2006) The world technology frontier. American Economic Review 96 (3), 499–522.Google Scholar
Chu, Angus, Cozzi, Guido, and Galli, Silvia (2014) Stage-dependent intellectual property rights. Journal of Development Economics 106, 239–249.Google Scholar
Cohen, Wesley and Klepper, Steven (1996) A reprise of size and R&D. Economic Journal 106 (437), 925–51.Google Scholar
Durlauf, Steven (1993) Nonergodic economic growth. Review of Economic Studies 60, 349–367.Google Scholar
Evans, Paul (1996) Using cross-country variances to evaluate growth theories. Journal of Economic Dynamics and Control 20, 1027–1049.Google Scholar
Feyrer, James (2008) Convergence by parts. Contributions to macroeconomics. Berkeley Electronic Press 8 (1), 1–35.Google Scholar
Furukawa, Yuichi (2015) Leapfrogging cycles in international competition. Economic Theory 59 (2), 401–433.Google Scholar
Galor, Oded (2005) Unified growth theory: From stagnation to growth. In Aghion, Peter and Durlauf, Steven (eds.), Handbook of Economic Growth, pp. 171–293. Amsterdam: North-Holland.Google Scholar
Galor, Oded and Weil, David N. (1996) The gender gap, fertility, and growth. American Economic Review 86 (3), 374–387.Google Scholar
Galor, Oded and Zeira, Joseph (1993) Income distribution and macroeconomics. Review of Economic Studies 60 (1), 35–52.Google Scholar
Gerschenkron, Alexander (1952) Economic backwardness in historical perspective. In Hoselitz, Bert (ed.), The Progress of Underdeveloped Areas, pp. 3–29. Chicago: University of Chicago Press.Google Scholar
Hall, Robert E. (1990) Invariance properties of Solows productivity residual. In Diamond, Peter (ed.), Growth/ Productivity/Unemployment: Essays to Celebrate Bob Solows Birthday, pp. 71–112. Cambridge, MA: MIT Press.Google Scholar
Howitt, Peter (2000) Endogenous growth and cross-country income differences. American Economic Review 90, 829–46.Google Scholar
Howitt, Peter and Mayer-Foulkes, David (2005) R&D, implementation and stagnation: A Schumpeterian theory of convergence clubs. Journal of Money, Credit and Banking 37, 147–77.Google Scholar
Jorgenson, Dale, Gollop, Frank, and Fraumeni, Barbara (1987) Productivity and U.S. Economic Growth. Cambridge, MA: Harvard University Press.Google Scholar
Klenow, Peter J. and Rodríguez-Clare, Andrés (2005) Externalities and growth. In Aghion, Philippe and Durlauf, Steven (eds.), Handbook of Economic Growth 1(1), chapter 11, pp. 817–861. Amsterdam: Elsevier.Google Scholar
Kortum, Eaton (1993) Equilibrium R&D and the patent-R&D ratio: US evidence. American Economic Review: Papers and Proceedings 83 (2), 450–457.Google Scholar
Maddison, Angus (2009) Statistics on World population, GDP and Per Capita GDP, 1-2006 AD.Google Scholar
Mankiw, Gregory, Romer, David, and Weil, David (1992) A contribution to the empirics of economic growth. Quarterly Journal of Economics 107, 407–437.Google Scholar
Matsuyama, Kiminori (1999) Growing through cycles. Econometrica 67 (2), 335–348.Google Scholar
McDermott, John (2002) Development dynamics: Economic integration and the demographic transition. Journal of Economic Growth 7 (4), 371–409.Google Scholar
Murphy, Kevin, Shleifer, Andrei, and Vishny, Robert (1989) Industrialization and the big push. Journal of Political Economy 97 (5), 1003–1026.Google Scholar
Nelson, Richard and Phelps, Edmund S. (1966) Investment in humans, technological diffusion, and economic growth. American Economic Review 56, 69–75.Google Scholar
Norrbin, Stefan (1993) The relationship between price and marginal cost in U.S. industry: A contradiction. Journal of Political Economy 101, 1149–1164.Google Scholar
OECD (2010) Perspectives on Global Development 2010. Shifting Wealth. Paris: OECD Publishing.Google Scholar
Parente, Stephen and Prescott, Edward C. (1994) Technology adoption and growth. Journal of Political Economy 102, 298–321.Google Scholar
Parente, Stephen and Prescott, Edward C. (2002) Barriers to Riches. Cambridge, MA: MIT Press.Google Scholar
Pritchett, Lant (1997) Divergence, big-time. Journal of Economic Perspectives 11, 3–17.Google Scholar
Vandenbussche, Jerome, Aghion, Phillipe, and Meghir, Costas (2006) Growth, distance to frontier and composition of human capital. Journal of Economic Growth 11 (2), 97–127.Google Scholar