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Microeconomics of Technology Adoption

  • Andrew D. Foster
  • Mark R. Rosenzweig

    (Economic Growth Center, Yale University)

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    There is an emerging consensus among macro-economists that differences in technology across countries accounts for the major differences in per-capita GDP and the wages of workers with similar skills across countries. Accounting for differences in technology levels across countries thus can go a long way towards understanding global inequality. One mechanism by which poorer countries can catch up with richer countries is through technological diffusion, the adoption by low-income countries of the advanced technologies produced in high-income countries. In this survey, we examine recent micro studies that focus on understanding the adoption process. If technological diffusion is a major channel by which poor countries can develop, it must be the case that technology adoption is incomplete or the inputs associated with the technologies are under-utilized in poor, or slow-growing economies. Thus, obtaining a better understanding of the constraints on adoption are useful in understanding a major component of growth.

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    File URL: http://www.econ.yale.edu/growth_pdf/cdp984.pdf
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    Paper provided by Economic Growth Center, Yale University in its series Working Papers with number 984.

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    Length: 43 pages
    Date of creation: Jan 2010
    Date of revision:
    Handle: RePEc:egc:wpaper:984
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