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Growth, technological interdependence and spatial externalities: theory and evidence

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  • Cem Ertur

    (Laboratoire d'Economie d'Orléans, Université d'Orléans, Orléans, France)

  • Wilfried Koch

    (Laboratoire d'Economie et de Gestion, Université de Bourgogne, Dijon, France)

Abstract

This paper presents a theoretical growth model which explicitly takes into account technological interdependence among economies and examines the impact of spillover effects. Technological interdependence is assumed to operate through spatial externalities. The magnitude of the physical capital externalities at steady state, which is not usually identified in the literature, is estimated using a spatial econometric specification. Spatial externalities are found to be significant. This spatially augmented Solow model yields a conditional convergence equation which is characterized by parameter heterogeneity. A locally linear spatial autoregressive specification is then estimated providing a convergence speed estimate for each country of the sample. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Cem Ertur & Wilfried Koch, 2007. "Growth, technological interdependence and spatial externalities: theory and evidence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(6), pages 1033-1062.
    • Handle: RePEc:jae:japmet:v:22:y:2007:i:6:p:1033-1062
    DOI: 10.1002/jae.963
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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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