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Productivity Growth in Backward Economies and the Role of Barriers to Technology Adoption

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  • Hildegunn Ekroll Stokke

    ()
    (Department of Economics, Norwegian University of Science and Technology)

Abstract

We offer a barrier model of growth with a broader understanding of the sources of productivity growth. Organizational change is suggested as an alternative to innovation and technology adoption. Domestic and international barriers (related to the level of human capital and the trade share) determine the timing and pace of technological catch-up, and as opposed to the catchingup hypothesis backward economies may get stuck in a poverty trap. Growth in lagging economies is not driven by adoption of foreign technology due to inappropriateness. The large technological distance forces the economy to rely more on own productivity improvements through organizational change. Trade liberalization in backward economies does not give the expected boost to productivity growth, because of low capability to take advantage of the frontier technology. Economies can escape the poverty trap by reducing trade barriers, but the benefits from an open economy is highest in middle-income economies, which have both the potential and capability to adopt foreign technology.

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Bibliographic Info

Paper provided by Department of Economics, Norwegian University of Science and Technology in its series Working Paper Series with number 4905.

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Length: 31 pages
Date of creation: 10 Mar 2005
Date of revision:
Handle: RePEc:nst:samfok:4905

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Keywords: Ramsey-model; sources of growth; trade barriers; poverty trap;

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Cited by:
  1. Rami Abdelkafi & Hatem Derbel, 2008. "Une décomposition de l'effet de la liberté économique sur la croissance dans les pays en développement," EconomiX Working Papers 2008-19, University of Paris West - Nanterre la Défense, EconomiX.
  2. Rami Abdelkafi & Hatem Derbel & Ali Chkir, 2009. "Libéralisme Économique et Croissance: Le Cas de Six Pays Méditerranéens," EconomiX Working Papers 2009-35, University of Paris West - Nanterre la Défense, EconomiX.

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