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Assessing the Role of Technology Adoption in China's Growth Performance

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Author Info
Nadja Wirz (University of St. Gallen, Switzerland)
Abstract

China has experienced a period of tremendous economic growth in recent years. In an attempt to explain this development, several existing growth-accounting studies reveal that impressively high rates of productivity growth have been at the heart of China's performance. This study investigates to what extent these productivity increases can be explained by technology-adoption theory. In less developed countries, the key element behind technological progress is technology adoption, the process of copying technological knowledge invented throughout the world. To uncover a measure of China's technological advances, the paper constructs a hybrid of some prominent technology-adoption models and calibrates it to reasonable parameter values. The calibrated version of the model is then combined with Chinese economic data. For the period 1978-2005, the analysis finds that the Chinese performance can be explained to a surprisingly large extent by the suggested technology-adoption framework. It can account for roughly 80% of China's productivity gains.

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Paper provided by Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics in its series EPRU Working Paper Series with number 2008-06.

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Length: 38 pages
Date of creation: Oct 2008
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Handle: RePEc:kud:epruwp:08-06

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Related research
Keywords: technological progress; technology adoption; TFP; China;

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Find related papers by JEL classification:
O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
O30 - Economic Development, Technological Change, and Growth - - Technological Change - - - General
O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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