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The international diffusion of new technologies: a multi-technology analysis of latecomer advantage and global economic integration

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  • Richard Perkins
  • Eric Neumayer

Abstract

The diffusion of modern, efficient technology has far-reaching consequences for the geography of economic activity, inequality and environmental quality. This article examines two popular yet highly controversial claims about the conditions most favorable to the rapid spread of new technology. The first states that latecomer advantage allows developing countries to diffuse new technology faster than developed countries. The second claim, widely articulated by advocates of neo-liberal policy reform, is that new technologies diffuse more rapidly where countries are “open” to international trade and investment. To investigate these claims we use event-history analysis to estimate the determinants of diffusion speed across a large panel of developed and developing countries for three very different technologies. These are: continuous steel casting, shuttleless textile weaving looms and digital telephone mainlines. Our results broadly support both propositions. Countries which adopt new technology later or have a smaller existing capital stock – characteristic features of developing countries – diffuse new technology more rapidly than countries that adopt earlier or have more installed capacity – two characteristics of developed countries. Trade openness is also found to influence the rate of diffusion positively for all three technologies. Yet, consistent with recent empirical studies, we fail to find support for the idea that foreign direct investment (FDI) accelerates the diffusion of new technology in host economies. The paper concludes by discussing the geographical implications of our findings.

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File URL: http://128.118.178.162/eps/dev/papers/0407/0407001.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Development and Comp Systems with number 0407001.

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Date of creation: 01 Jul 2004
Date of revision: 01 Jul 2004
Handle: RePEc:wpa:wuwpdc:0407001

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Web page: http://128.118.178.162

Related research

Keywords: Diffusion; globalization; industrialization; latecomer; technology;

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Cited by:
  1. Indra de Soysa & Eric Neumayer, 2004. "False Prophet, or Genuine Savior? Assessing the Effects of Economic Openness on Sustainable Development, 1980–1999," International Trade, EconWPA 0409001, EconWPA, revised 13 Oct 2004.
  2. Kingsley E. Haynes & Lei Ding, 2006. "Technology, Innovation and Latecomer Strategies: Evidence from the Mobile Handset Manufacturing Sector in China," ERSA conference papers ersa06p17, European Regional Science Association.
  3. Mocnik, Dijana & Sirec, Karin, 2010. "The determinants of Internet use controlling for income level: Cross-country empirical evidence," Information Economics and Policy, Elsevier, Elsevier, vol. 22(3), pages 243-256, July.
  4. Peters, Kay & Albers, Sönke & Kumar, V., 2008. "Is there more to international Diffusion than Culture? An investigation on the Role of Marketing and Industry Variables," EconStor Preprints, ZBW - German National Library of Economics 27678, ZBW - German National Library of Economics.

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