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Structural development accounting

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  • Gino Gancia

    ()

  • Andreas Müller
  • Fabrizio Zilibotti

Abstract

We construct and estimate a unified model combining three of the main sources of cross-country income disparities: differences in factor endowments, barriers to technology adoption and the inappropriateness of frontier technologies to local conditions. The key components are different types of workers, distortions to capital accumulation, directed technical change, costly adoption and spillovers from the world technology frontier. Despite its parsimonious parametrization, our empirical model provides a good fit of GDP data for up to 86 countries in 1970 and 122 countries in 2000. Removing barriers to technology adoption would increase the output per worker of the average non-OECD country relative to the US from 0.19 to 0.61, while increasing skill premia in all countries. Removing barriers to trade in goods amplifies income disparities, induces skill-biased technology adoption and increases skill premia in the majority of countries. These results are reverted if trade liberalization is coupled with international IPR protection.

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Bibliographic Info

Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 1249.

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Date of creation: Jul 2010
Date of revision: Feb 2011
Handle: RePEc:upf:upfgen:1249

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Web page: http://www.econ.upf.edu/

Related research

Keywords: Directed Technology Adoption; Development Accounting; Distance to Frontier; Inappropriate Technologies; Skill-biased Technical Change; Productivity; TFP differences.;

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References

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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Towards better growth accounting
    by Economic Logician in Economic Logic on 2011-01-18 14:23:00
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Cited by:
  1. Acemoglu, Daron & Gancia, Gino A & Zilibotti, Fabrizio, 2012. "Offshoring and Directed Technical Change," CEPR Discussion Papers 9247, C.E.P.R. Discussion Papers.
  2. Harald Fadinger & Karin Mayr, 2012. "Skill-biased technological change, unemployment and brain drain," FIW Working Paper series 089, FIW.
  3. Acemoglu, Daron & Gancia, Gino & Zilibotti, Fabrizio, 2012. "Competing engines of growth: Innovation and standardization," Journal of Economic Theory, Elsevier, vol. 147(2), pages 570-601.e3.
  4. Gino Gancia, 2012. "Globalization, technology and inequality," Economics Working Papers 1363, Department of Economics and Business, Universitat Pompeu Fabra, revised Nov 2012.
  5. Jonathan Vogel & Javier Cravino & Ariel Burstein, 2011. "Importing Skill-Biased Technology," 2011 Meeting Papers 440, Society for Economic Dynamics.
  6. German Cubas & B. Ravikumar & Gustavo Ventura, 2013. "Talent, labor quality, and economic development," Working Papers 2013-027, Federal Reserve Bank of St. Louis.

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