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Technological Integration and Income Gaps

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Author Info
Carlos Humberto Ortiz () (Economics Departament of Universidad del Valle)
Javier Andrés Castro () (Economics Departament of Universidad del Valle (Cali, Colombia))

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Abstract

Leontief (1963) claimed that underdeveloped countries are poor because they are by far less economically diversified. This paper shows that a general equilibrium model with a stable input-output structure and a productivity externality due to input diversification may be consistent with Leontief´s hypothesis. An open economy version of the model yields the possibility of breaking the factor price equalization theorem so that developed economies enjoy higher capital remuneration and higher income level. Some empirical evidence on the relationship between technological integration and real income is provided.

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Publisher Info
Article provided by Universidad de Antioquia, Departamento de Economía in its journal LECTURAS DE ECONOMÍA.

Volume (Year): (2008)
Issue (Month): 68 (Enero-Junio)
Pages: 217-247
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Handle: RePEc:lde:journl:y:2008:i:68:p:217-247

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Web page: http://economia.udea.edu.co
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Postal: Apartado Aéreo 1226, Medellín - Colombia

For technical questions regarding this item, or to correct its listing, contact: (Carlos Andrés Vasco Correa).

Related research
Keywords: input-output; technological integration; income gaps; asymmetric technological structures; factor price equalization;

Find related papers by JEL classification:
C67 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Input-Output Models
D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
F11 - International Economics - - Trade - - - Neoclassical Models of Trade
L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
O14 - Economic Development, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

References listed on IDEAS
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