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Does Trade and Technology Transmission Facilitate Inequality Convergence? An Inquiry into the Role of Technology in Reducing the Poverty of Nations

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  • Gouranga Gopal Das

Abstract

Based on stylized evidence showing variation of the Gini coefficient of income inequality across skill cohorts and on the rapid rise in trade in technology-intensive goods, the ripple effects of technology transmission and income inequality are explored in a global Computable General Equilibrium (CGE) framework. An exogenous technology shock transmitted via trade from the United States induces productivity growth in developing regions. This spillover capture-aided by absorptive capability, better governance and institutions, technological symmetry and social acceptance-causes income to increase and income inequality to decline. The conjoined parameters retard growth's inequality-enhancing effect and thus facilitate long-run convergence of inequality between nations.

Suggested Citation

  • Gouranga Gopal Das, 2007. "Does Trade and Technology Transmission Facilitate Inequality Convergence? An Inquiry into the Role of Technology in Reducing the Poverty of Nations," IMF Working Papers 07/16, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:07/16
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    Cited by:

    1. repec:kap:jtecht:v:43:y:2018:i:1:d:10.1007_s10961-015-9456-1 is not listed on IDEAS
    2. Petr Blizkovsky, 2012. "Are We Living in a Converging World? Regional Disparities and Convergences from a Global Perspective," Research in World Economy, Research in World Economy, Sciedu Press, vol. 3(2), pages 41-51, September.

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