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The Sun Also Rises: Productivity Convergence Between Japan and the USA

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Author Info
Gavin Cameron

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Abstract

The growth process for a technological leader is different from that of a follower. While followers can grow through imitation and capital deepening, a leader must undertake original research. This suggests that as the gap between the leader and the follower narrows, the follower must undertake more formal R&D and possibly face a slower overall growth rate. This paper constructs measures of relative total factor productivity for eleven Japanese manufacturing industries and uses dynamic panel data methods to test whether a smaller productivity gap leads to slower growth, and whether R&D takes over as the engine of growth as Japan approaches the technological frontier. The results suggest that Japanese and US productivity have been growing at similar rates since the mid-1970s, and that some of the Japanese growth slowdown is attributable to the exhaustion of imitation possibilities.

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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 045.

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Date of creation: 2000
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Handle: RePEc:oxf:wpaper:045

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Keywords: economic growth total factor productivity catch-up innovation heterogeneous dynamic panels

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Find related papers by JEL classification:
C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Estimation
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
O30 - Economic Development, Technological Change, and Growth - - Technological Change - - - General
O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Hildegunn Ekroll Stokke, 2005. "Productivity Growth in Backward Economies and the Role of Barriers to Technology Adoption," Working Paper Series 4905, Department of Economics, Norwegian University of Science and Technology. [Downloadable!]
  2. Tehmina S. Khan, 2006. "Productivity Growth, Technological Convergence, R&D, Trade, and Labor Markets: Evidence from the French Manufacturing Sector," IMF Working Papers 06/230, International Monetary Fund. [Downloadable!]
  3. Erdal Atukeren, 2007. "A Causal Analysis of the R&D Interactions between the EU and the US," Global Economy Journal, International Trade and Finance Association, vol. 7(4), pages 1. [Downloadable!]
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