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Trade-mediated biotechnology transfer and its effective absorption: an application to the U.S. forestry sector

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  • Das, Gouranga Gopal
  • Alavalapati, Janaki

Abstract

n this paper, we analyze the consequences of biotechnology innovations in the United States forest sector (logging) by modeling technology transfer embodied in trade flows and its absorption. A seven-region, seven-traded-commodity version of a dynamic computable general equilibrium model is used to achieve this task. A 0.63% Hicks-neutral biotechnological progress in the source region (U.S.) has differential impacts on the productivity of the log-using sectors in the domestic as well as in the recipient regions. Since recipient regions' ability to utilize biotechnology innovations depends on their absorptive capacity (AC) and structural similarity (SS), we construct the AC and SS indices based on multiplicity of factors such as human capital endowments, skill content and social appropriateness of the new innovations. The model results show that biotechnological innovations in the U.S. forest sector result in a significant increase in timber production. Following the productivity improvements and its embodied spillover, wood products and pulp and paper sectors in the U.S. register higher productivity growth. The role of AC and SS in capturing technical change is shown to be evident. In the face of growing regulations on timber production from public forests, increasing productivity through biotechnology may be the most effective way to meet the consumer demand for forest products.

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File URL: http://mpra.ub.uni-muenchen.de/37254/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 37254.

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Date of creation: 15 Jun 2001
Date of revision: 01 Feb 2002
Publication status: Published in Technological forecasting and Social Change 6.70(2003): pp. 545-562
Handle: RePEc:pra:mprapa:37254

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Related research

Keywords: Total factor productivity; Dynamic computable general equilibrium; Capture parameter; Forestry biotechnology;

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  1. Ianchovichina, Elena & Robert McDougall, 2000. "Theoretical Structure of Dynamic GTAP," GTAP Technical Papers 480, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
  2. Michelle P. Connolly, 1997. "Technology, trade and growth: some empirical findings," Research Paper 9727, Federal Reserve Bank of New York.
  3. Sedjo, Roger, 1997. "The Forest Sector: Important Innovations," Discussion Papers dp-97-42, Resources For the Future.
  4. Coe, David T & Helpman, Elhanan & Hoffmaister, Alexander, 1995. "North-South R&D Spillovers," CEPR Discussion Papers 1133, C.E.P.R. Discussion Papers.
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  8. Sedjo, Roger, 1999. "Biotechnology and Planted Forests: Assessment of Potential and Possibilities," Discussion Papers dp-00-06, Resources For the Future.
  9. Pack, Howard & Westphal, Larry E., 1986. "Industrial strategy and technological change : Theory versus reality," Journal of Development Economics, Elsevier, vol. 22(1), pages 87-128, June.
  10. Hans Meijl & Frank Tongeren, 1998. "Trade, technology spillovers, and food production in China," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 134(3), pages 423-449, September.
  11. Dietzenbacher, Erik, 2000. "Spillovers of Innovation Effects," Journal of Policy Modeling, Elsevier, vol. 22(1), pages 27-42, January.
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  13. Fagerberg, Jan, 1994. "Technology and International Differences in Growth Rates," Journal of Economic Literature, American Economic Association, vol. 32(3), pages 1147-75, September.
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