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Non‐Scale Effects Of International Technological‐Knowledge Diffusion On Southern Growth And Wages

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  • OSCAR AFONSO

Abstract

We develop a dynamic, general equilibrium non‐scale endogenous growth model of North–South technological‐knowledge diffusion by imitation. Countries differ in levels of exogenous productivity, human‐capital levels and R&D capacity. Growth is driven by Northern innovative R&D and the South converges towards the North. Growth is also driven by human‐capital accumulation, scale effects are removed, imitation is only feasible once a threshold distance to the frontier has been attained and is dependent on the South's relative level of employed human capital and on domestic policies promoting R&D. Imitation promotes partial convergence of inter‐country wages and governs the path of intra‐South wage inequality.

Suggested Citation

  • Oscar Afonso, 2010. "Non‐Scale Effects Of International Technological‐Knowledge Diffusion On Southern Growth And Wages," The Japanese Economic Review, Japanese Economic Association, vol. 61(3), pages 341-366, September.
    • Handle: RePEc:bla:jecrev:v:61:y:2010:i:3:p:341-366
    DOI: 10.1111/j.1468-5876.2009.00495.x
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