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If Technology Has Arrived Everywhere, Why Has Income Diverged?

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  • Comin, Diego
  • Mestieri, Marti

Abstract

If Technology Has Arrived Everywhere, Why Has Income Diverged? We study the lags with which new technologies are adopted across countries, and their long-run penetration rates once they are adopted. Using data from the last two centuries, we document two new facts: there has been convergence in adoption lags between rich and poor countries, while there has been divergence in penetration rates. Using a model of adoption and growth, we show that these changes in the pattern of technology diffusion account for 80% of the Great Income Divergence between rich and poor countries since 1820.

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Paper provided by Toulouse School of Economics (TSE) in its series TSE Working Papers with number 13-409.

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Date of creation: May 2013
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Handle: RePEc:tse:wpaper:27237

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  1. Diego Comin & Bart Hobijn & Emilie Rovito, 2008. "A new approach to measuring technology with an application to the shape of the diffusion curves," The Journal of Technology Transfer, Springer, vol. 33(2), pages 187-207, April.
  2. Comin, D. & Hobijn, B., 2004. "Cross-country technology adoption: making the theories face the facts," Journal of Monetary Economics, Elsevier, vol. 51(1), pages 39-83, January.
  3. Barro, Robert J. & Sala-i-Martin, Xavier, 1995. "Technological Diffusion, Convergence and Growth," CEPR Discussion Papers 1255, C.E.P.R. Discussion Papers.
  4. Tamura, Robert, 2002. "Human capital and the switch from agriculture to industry," Journal of Economic Dynamics and Control, Elsevier, vol. 27(2), pages 207-242, December.
  5. Basu, Susanto & Fernald, John G, 1997. "Returns to Scale in U.S. Production: Estimates and Implications," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 249-83, April.
  6. Oded Galor & Andrew Mountford, 2006. "Trade and the Great Divergence: The Family Connection," American Economic Review, American Economic Association, vol. 96(2), pages 299-303, May.
  7. Pritchett, Lant, 1995. "Divergence, big time," Policy Research Working Paper Series 1522, The World Bank.
  8. Robert E. Lucas, 2000. "Some Macroeconomics for the 21st Century," Journal of Economic Perspectives, American Economic Association, vol. 14(1), pages 159-168, Winter.
  9. Gary D. Hansen & Edward C. Prescott, 2002. "Malthus to Solow," American Economic Review, American Economic Association, vol. 92(4), pages 1205-1217, September.
  10. Diego A. Comin & Martí Mestieri, 2010. "An Intensive Exploration of Technology Diffusion," NBER Working Papers 16379, National Bureau of Economic Research, Inc.
  11. Kevin H. O’Rourke & Ahmed S. Rahman & Alan M. Taylor, 2012. "Trade, Technology and the Great Divergence," Departmental Working Papers 35, United States Naval Academy Department of Economics.
  12. David N. Weil & Oded Galor, 2000. "Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond," American Economic Review, American Economic Association, vol. 90(4), pages 806-828, September.
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  1. Income divergence in the face of faster technology adoption
    by Economic Logician in Economic Logic on 2013-06-27 14:14:00
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Cited by:
  1. Comin, Diego & Rode, Johannes, 2013. "From Green Users to Green Voters," CEPR Discussion Papers 9573, C.E.P.R. Discussion Papers.
  2. William F. Maloney & Felipe Valencia Caicedo, 2014. "Engineers, Innovative Capacity and Development in the Americas," DOCUMENTOS CEDE 011948, UNIVERSIDAD DE LOS ANDES-CEDE.
  3. Wim Naudé & Adam Szirmai, 2013. "Technological Innovation, Entrepreneurship, and Development," Working Papers 2013/17, Maastricht School of Management.

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