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Cross-Country Income Differences and Technology Diffusion in a Competitive World

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  • Andreas Irmen

Abstract

This paper develops a new open-economy endogenous growth model where technology diffusion allows for a stable and non-degenerate world income distribution. In accordance with the empirical literature, I find that country characteristics such as the social infrastructure, the degree of openness, the investment rate, population growth, the level of human capital, or growth policies such as subsidies to innovation investments explain a country’s position in the eventual world income distribution. Club convergence in growth rates can be traced back to a country’s openness and to a minimum required level of human capital.

Suggested Citation

  • Andreas Irmen, 2008. "Cross-Country Income Differences and Technology Diffusion in a Competitive World," CESifo Working Paper Series 2504, CESifo.
  • Handle: RePEc:ces:ceswps:_2504
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    More about this item

    Keywords

    capital accumulation; technology diffusion; neoclassical growth model;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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