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Trade Liberalization, Democratization and Technology Adoption

Author

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  • Matteo Cervellati
  • Alireza Naghavi
  • Farid Toubal

Abstract

We study the role of trade liberalization, democratization and their interaction for technology adoption. A general equilibrium theory with heterogeneous skills predicts a complementarity between trade and political regimes. Openness should accelerate technology adoption if coupled with democratization but may lead to a slowdown if these regime changes are imbalanced. We use panel data on technology adoption at the sectoral level for the period 1980-2000. We exploit within country variation and the heterogenous timing of openness and democratization. The results document the existence of a positive interaction between these institutional changes for technology adoption.

Suggested Citation

  • Matteo Cervellati & Alireza Naghavi & Farid Toubal, 2014. "Trade Liberalization, Democratization and Technology Adoption," Working Papers 2014-08, CEPII research center.
  • Handle: RePEc:cii:cepidt:2014-08
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    References listed on IDEAS

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    Cited by:

    1. Michiel Gerritse, 2015. "Does trade cause long-run development? Theory and evidence from countries behind the Suez channel," ERSA conference papers ersa15p1100, European Regional Science Association.

    More about this item

    Keywords

    Trade Openness; Democratization; Political Economy theory; Technology Adoption; Sector Level Data; Cross-Country Analysis;

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other

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