The Dual Nature of Trade: Measuring Its Impact onImitation and Growth
Imports of goods that embody foreign technology can raise a country's output directly as inputs into production and indirectly through reverse-engineering of these goods, which contributes to domestic imitation and innovation. This paper first quantifies spillovers from high technology imports to domestic imitation and innovation in both developed and developing countries. It then considers the contribution of foreign and domestic innovation to real per capita GDP growth.
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