The Diffusion of Technology and Inequality Among Nations PDF Download

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Languages : en
Pages : 44

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Author: Boyan Jovanovic
Publisher:
ISBN:
Category : Diffusion of innovations
Languages : en
Pages : 64

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One usually accounts for output growth in terms of the growth of the primary inputs: labor, physical capital, and possibly human capital. In this paper we account for growth with labor and with intermediate goods. Because we have no measures of the extent of adoption of most intermediate goods in most countries, we have to assume something about how they spread, based on what we see in U.S. data. We find that if all countries have (al the same production function, (b) the same speed of adoption technology, and (c) imperfectly correlated technology shocks, then we can easily account for the extent and persistence of inequality among nations. Unfortunately, while it easily generates the sorts of low frequency movements that we observe, our technology shock seems to have little to do with high frequency movements in GNP so that if our definition of this shock is correct, real business cycle models are way off the mark.

Author: Gouranga Gopal Das
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 44

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Based on stylized evidence showing variation of the Gini coefficient of income inequality across skill cohorts and on the rapid rise in trade in technology-intensive goods, the ripple effects of technology transmission and income inequality are explored in a global Computable General Equilibrium (CGE) framework. An exogenous technology shock transmitted via trade from the United States induces productivity growth in developing regions. This spillover capture-aided by absorptive capability, better governance and institutions, technological symmetry and social acceptance-causes income to increase and income inequality to decline. The conjoined parameters retard growth's inequality-enhancing effect and thus facilitate long-run convergence of inequality between nations.

Author: Susan Cozzens
Publisher: Edward Elgar Publishing
ISBN: 1781951675
Category : Technology & Engineering
Languages : en
Pages : 357

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Susan Cozzens, Dhanaraj Thakur, and the other co-authors ask how the benefits and costs of emerging technologies are distributed amongst different countries _ some rich and some poor. Examining the case studies of five technologies across eight countri

Author: Ms.Era Dabla-Norris
Publisher: International Monetary Fund
ISBN: 1513547437
Category : Business & Economics
Languages : en
Pages : 39

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This paper analyzes the extent of income inequality from a global perspective, its drivers, and what to do about it. The drivers of inequality vary widely amongst countries, with some common drivers being the skill premium associated with technical change and globalization, weakening protection for labor, and lack of financial inclusion in developing countries. We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down. This suggests that policies need to be country specific but should focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class. To tackle inequality, financial inclusion is imperative in emerging and developing countries while in advanced economies, policies should focus on raising human capital and skills and making tax systems more progressive.

Author: Adrian Jäggi
Publisher:
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Category :
Languages : en
Pages : 0

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This dissertation uses theoretical as well as empirical tools to study determinants of cross-country differences in income growth, focussing on the role of consumer inequality, values, and the diffusion process of technologies. Chapter 1 investigates how household income inequality shapes the diffusion of technologies. A simple demand side model with hierarchical preferences is used to show that after some minimum level of average income relative to the price of the technology is achieved, more consumer inequality hinders the diffusion process for new technologies. Using data on 39 major technologies, the empirical part tests this proposition. It is found that more inequality, as measured by the Gini index, is detrimental to the diffusion of new technology, while a large middle class is conducive to technology diffusion. These effects are stronger for consumer than for producer technologies. Furthermore, there is some evidence that the negative effect of inequality on the diffusion of technologies is more pronounced in rich countries. For the extensive margin, the chapter presents evidence for a positive effect of inequality on technology adoption. Chapter 2 introduces a model of creative destruction with non-homothetic preferences for quality to study the joint growth effects of inequality and openness. While the growth effects of consumer inequality are non-trivial, the chapter shows that once it is possible for rich consumers to import high quality goods, higher inequality interacted with more openness has a negative impact on quality upgrading in countries that are not operating at the technology frontier. This effect materializes through reduced incentives for domestic firms to innovate. The empirical analysis uses sectoral quality data to investigate these model predictions. It is shown that for developing countries, consumer inequality and openness indeed have a joint negative effect on the rate of quality upgrading. Chap.

Author: Dimitri Lenzin
Publisher:
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Category :
Languages : en
Pages :

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We study the effects of income inequality on technology adoption lags and on long-run technology penetration rates. Building on the model and findings of Comin and Mestieri (2013a), we analyze a sample of 72 countries between 1960 and 1995. They find converging adoption lags and diverging penetration rates between Western and non-Western countries. This evolution explains 80% of the Great Income Divergence between the two country groups. Applying pooled OLS, we find that it matters where in the income distribution the inequality appears, which confirms our theoretical predictions. In contrast, overall inequality measured by the Gini coefficient is too broad to be significant. Hence, quantile income shares are crucial. Distortion-free redistribution from the rich to the poor decreases the adoption lag. Moreover, a higher income share of the middle class at the expense of the rich or the poor increases the adoption lag. When it comes to the long run technology penetration rate, we find that lower overall inequality increases the penetration. Increasing the income share of the middle class at the expense of the rich or the poor increases the penetration rate. Our results suggest that a strong middle class increased the adoption lags and penetration rates in Western countries. Therefore, it may account for some of the convergence of adoption lags and divergence of penetration rates between the two country groups.

Author: Chris Papageorgiou
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 42

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We examine the relationship between trade and financial globalization and the rise in inequality in most countries in recent decades. We find technological progress as having a greater impact than globalization on inequality. The limited overall impact of globalization reflects two offsetting tendencies: whereas trade globalization is associated with a reduction in inequality, financial globalization-and foreign direct investment in particular-is associated with an increase. A key finding is that both globalization and technological changes increase the returns on human capital, underscoring the importance of education and training in both developed and developing countries in addressing rising inequality.

Author: Johannes Eugster
Publisher: International Monetary Fund
ISBN: 1484390601
Category : Business & Economics
Languages : en
Pages : 37

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How important is foreign knowledge for domestic innovation outcomes? How is this relation shaped by globalization and the attendant intensification of international competition? Our empirical approach extends the previous literature by analyzing a large panel comprising industries in both advanced and emerging economies over the past two decades. We find that barriers to the domestic diffusion of foreign knowledge have fallen significantly for emerging economies. For all countries, and especially for emerging economies, inflows of foreign knowledge have a growing and quantitatively important impact on domestic innovation. Controlling for the amount of domestic R&D, we find evidence that increases in international competitive pressure at the industry level had a positive effect on domestic innovation outcomes

Author: Ari Hyytinen
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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We study the effect of within-country income inequality on the diffusion of mobile phones using data on market penetration in a sample of developing countries from 1985 to 1998. Mobile phones are an example of international technology, originating in industrialized countries and diffusing worldwide. We find that income inequality, as measured by the income share of the highest earning deciles, has a positive effect on the early diffusion of mobile phones and that the estimated effect becomes greater when a measure of agricultural endowments is used as an instrument. The instrumental variable results are robust to weak instruments. Our findings suggest that the diffusion of new technologies originating from industrialized countries may generate yet another channel that links inequality and development.