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Geographic Localization of International Technology Diffusion

  • Wolfgang Keller

Income convergence across countries turns on whether technological knowledge spillovers are global or local. I estimate the amount of spillovers from R&D expenditures on a geographic basis, using a new data set which encompasses most of the world's innovative activity between 1970 and 1995. I find that technology is to a substantial degree local, not global, as the benefits from spillovers are declining with distance. The distance at which the amount of spillovers is halved is about 1,200 kilometers. I also find that over time, technological knowledge has become considerably more global. Moreover, language skills are important for spillover diffusion. (JEL F0, O1, O3)

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/000282802760015630
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Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 92 (2002)
Issue (Month): 1 (March)
Pages: 120-142

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Handle: RePEc:aea:aecrev:v:92:y:2002:i:1:p:120-142
Note: DOI: 10.1257/000282802760015630
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