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Product variety and technical change

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  • Richard Frensch

    () (Osteuropa-Institut, Regensburg (Institut for East European Studies))

  • Vitalija Gaucaite-Wittich

Abstract

Several trade-based measures of product variety have recently been used implicitly to represent states of technology, promoting long-run growth. In this paper, we define the state of technology as the range of specialised production processes and propose the variety of capital goods available for production as a direct measure of technology. Within a simple growth framework, we derive a testable “conditional technological convergence” hypothesis on this measure. The hypothesis is tested with highly disaggregated trade data by economic categories, using tools from the income convergence literature. The results suggest that trade-based count measures of the variety of available capital goods indeed behave “as if” they were representing technology and that there is conditional technological convergence among our panel of mainly OECD and transition economies.

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Bibliographic Info

Paper provided by Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies) in its series Working Papers with number 265.

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Length: 42
Date of creation: Nov 2006
Date of revision:
Handle: RePEc:ost:wpaper:265

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Keywords: Product variety; diffusion; adoption; technical change;

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References

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Citations

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Cited by:
  1. Richard Frensch & Jan Hanousek & Evžen Kočenda, 2012. "Incomplete specialization and offshoring across Europe," Working Papers 321, Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies).
  2. Frensch, Richard & Schmillen, Achim, 2011. "Can we identify Balassa-Samuelson effects with measures of product variety?," Economic Systems, Elsevier, vol. 35(1), pages 98-108, March.
  3. Jan Van Hove, 2010. "Variety and quality in intra-European manufacturing trade: the impact of innovation and technological spillovers," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 13(1), pages 43-59.
  4. Richard Frensch, 2008. "Trade liberalisation, adoption costs, and import margins in CEEC and OECD trade," Working Papers 269, Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies).
  5. Jakob B. Madsen & Shishir Saxena & James B. Ang, 2008. "The Indian Growth Miracle And Endogenous Growth," CAMA Working Papers 2008-29, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
  6. Lee, Jim, 2011. "Export specialization and economic growth around the world," Economic Systems, Elsevier, vol. 35(1), pages 45-63, March.
  7. Goran Petrevski & Jane Bogoev & Bruno S. Sergi, 2012. "The link between central bank independence and inflation in Central and Eastern Europe: are the results sensitive to endogeneity issue omitted dynamics and subjectivity bias?," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 34(4), pages 611-652, July.
  8. Katharina Eck, 2010. "(Wie) Führt Außenhandel zu Wirtschaftswachstum?," Working Papers 284, Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies).

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