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Economic Development and Technology Diffusion

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  • Kurt Hafner

Abstract

I first present a New Economic Geography model and analyze the impact of R&D on economic development of integrating countries. I find that technology diffusion and skilled labor migration stimulates economic development through fix cost reduction on a firm level. As the inclusion of foreign technology matters for structurally backward countries, I second use time series data for Greece, Portugal, Spain and Ireland representing European integration during the 1980s and 1990s. In considering three different technology diffusion channels, estimates, however, reduces to Portugal as test procedures confirm nonstationarity and cointegration only for this country. I find empirical evidence for bilateral trade as a diffusion channel but not for FDI or foreign patents.

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Bibliographic Info

Paper provided by DEGIT, Dynamics, Economic Growth, and International Trade in its series DEGIT Conference Papers with number c012_008.

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Length: 30 pages JEL Classification: C22, C68, O30, R12
Date of creation: Jun 2007
Date of revision:
Handle: RePEc:deg:conpap:c012_008

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Keywords: Economic Geography; Agglomeration; Technology Diffusion; Nonstationary Time Series;

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Cited by:
  1. Hafner, Kurt A., 2005. "Agglomeration, Migration and Tax Competition," BERG Working Paper Series 52, Bamberg University, Bamberg Economic Research Group.

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