IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Human capital, trade and long-run productivity. Testing the technological absorption hypothesis for the Portuguese economy, 1960-2001

  • Aurora A.C. Teixeira

    ()

    (CEMPRE, Faculdade de Economia do Porto, Universidade do Porto)

  • Natércia Fortuna

    ()

    (CEMPRE, Faculdade de Economia do Porto, Universidade do Porto)

An important characteristic of the role of foreign trade in the technological catch-up of countries is the complementary nature of technological change and human capital formation. In this context, the level of education is likely to have a crucial impact on total factor productivity because it determines the capacity of an economy to carry out technological innovation, and to adopt and to implement efficiently technology from abroad. However, the role of human capital as a pre requisite for technology absorption although theoretically acknowledged has been empirically neglected. One of the main problems with empirical studies in this domain is that they do not clearly test the mechanisms through which trade, namely the import of capital goods, affects total factor productivity or, roughly the level of technological development of a given country. Through cointegration techniques, we demonstrate the relevance of the technological absorption hypothesis. We show that the interaction between human capital and (lagged) machinery imports – that is, the technological absorption capability - is the most critical determinant of Portuguese long-run total factor productivity.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.fep.up.pt/investigacao/workingpapers/06.08.10_WP226_teixeirafortuna.pdf
Download Restriction: no

Paper provided by Universidade do Porto, Faculdade de Economia do Porto in its series FEP Working Papers with number 226.

as
in new window

Length: 31 pages
Date of creation: Aug 2006
Date of revision:
Handle: RePEc:por:fepwps:226
Contact details of provider: Postal:
Rua Dr. Roberto Frias, 4200 PORTO

Phone: 351-22-5571100
Fax: 351-22-5505050
Web page: http://www.fep.up.pt/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. J. Bradford De Long & Lawrence H. Summers, . "Equipment Investment and Economic Growth," J. Bradford De Long's Working Papers _122, University of California at Berkeley, Economics Department.
  2. Mackinnon, J.G. & Haug, A.A. & Michelis, L., 1996. "Numerical Distribution Functions of Likelihood Ratio Tests for Cointegration," G.R.E.Q.A.M. 96a09, Universite Aix-Marseille III.
  3. Casey B. Mulligan & Xavier Sala-i-Martin, 1995. "Measuring Aggregate Human Capital," NBER Working Papers 5016, National Bureau of Economic Research, Inc.
  4. James G. MacKinnon, 1990. "Critical Values for Cointegration Tests," Working Papers 1227, Queen's University, Department of Economics.
  5. MacKinnon, James G, 1996. "Numerical Distribution Functions for Unit Root and Cointegration Tests," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 11(6), pages 601-18, Nov.-Dec..
  6. Bernard, Andrew B & Jones, Charles I, 1996. "Productivity across Industries and Countries: Time Series Theory and Evidence," The Review of Economics and Statistics, MIT Press, vol. 78(1), pages 135-46, February.
  7. Robert J. Barro & Jong-Wha Lee, 2000. "International Data on Educational Attainment Updates and Implications," NBER Working Papers 7911, National Bureau of Economic Research, Inc.
  8. Keuschnigg, Christian & Kohler, Wilhelm K., 1994. "Commercial Policy and Dynamic Adjustment Under Monopolistic Competition," CEPR Discussion Papers 1037, C.E.P.R. Discussion Papers.
  9. Benhabib, Jess & Spiegel, Mark M., 1994. "The role of human capital in economic development evidence from aggregate cross-country data," Journal of Monetary Economics, Elsevier, vol. 34(2), pages 143-173, October.
  10. Jong-Wha Lee, 1994. "Capital Goods Imports and Long-Run Growth," NBER Working Papers 4725, National Bureau of Economic Research, Inc.
  11. Andreas Savvides & Marios Zachariadis, 2005. "International Technology Diffusion and the Growth of TFP in the Manufacturing Sector of Developing Economies," Review of Development Economics, Wiley Blackwell, vol. 9(4), pages 482-501, November.
  12. Paul M Romer, 1999. "Endogenous Technological Change," Levine's Working Paper Archive 2135, David K. Levine.
  13. Saggi, Kamal, 2000. "Trade, foreign direct investment, and international technology transfer : a survey," Policy Research Working Paper Series 2349, The World Bank.
  14. Baldwin, Richard & Seghezza, Elena, 1996. "Trade-induced Investment-led Growth," CEPR Discussion Papers 1420, C.E.P.R. Discussion Papers.
  15. Parente, Stephen L & Prescott, Edward C, 1994. "Barriers to Technology Adoption and Development," Journal of Political Economy, University of Chicago Press, vol. 102(2), pages 298-321, April.
  16. Jörg MAYER, 2001. "Technology Diffusion, Human Capital And Economic Growth In Developing Countries," UNCTAD Discussion Papers 154, United Nations Conference on Trade and Development.
  17. Goldin, Claudia D. & Katz, Lawrence F., 1998. "The Origins of Technology-Skill Complementarity," Scholarly Articles 27867130, Harvard University Department of Economics.
  18. Francesco Caselli & Daniel Wilson, 2003. "Importing Technology," NBER Working Papers 9928, National Bureau of Economic Research, Inc.
  19. Angel de la Fuente & Rafael Donénech, 2000. "Human Capital in Growth Regressions: How much Difference Does Data Quality Make?," OECD Economics Department Working Papers 262, OECD Publishing.
  20. Robert J. Barro, 1989. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc.
  21. Gabriele Tondl, 2002. "Trade, Human Capital and Innovation: The Engines of European Regional Growth in the 1990s," Computing in Economics and Finance 2002 237, Society for Computational Economics.
  22. Balassa, Bela, 1978. "Exports and economic growth : Further evidence," Journal of Development Economics, Elsevier, vol. 5(2), pages 181-189, June.
  23. Barro, Robert J. & Lee, Jong-Wha, 1993. "International comparisons of educational attainment," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 363-394, December.
  24. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 39(3), pages 106-135.
  25. Bin Xu & Eric CHiang, 2005. "Trade, Patents and International Technology Diffusion," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 14(1), pages 115-135.
  26. Eduardo Borensztein & Jose De Gregorio & Jong-Wha Lee, 1995. "How Does Foreign Direct Investment Affect Economic Growth?," NBER Working Papers 5057, National Bureau of Economic Research, Inc.
  27. Kyriacou, George A., 1991. "Level and Growth Effects of Human Capital: A Cross-Country Study of the Convergence Hypothesis," Working Papers 91-26, C.V. Starr Center for Applied Economics, New York University.
  28. Jonathan Eaton & Samuel Kortum, 2001. "Trade in Capital Goods," NBER Working Papers 8070, National Bureau of Economic Research, Inc.
  29. Daron Acemoglu, 2000. "Technical Change, Inequality, and the Labor Market," NBER Working Papers 7800, National Bureau of Economic Research, Inc.
  30. Barro, Robert J & Lee, Jong Wha, 1996. "International Measures of Schooling Years and Schooling Quality," American Economic Review, American Economic Association, vol. 86(2), pages 218-23, May.
  31. Aurora A. C. Teixeira, 2004. "Measuring aggregate human capital in Portugal. An update up to 2001," FEP Working Papers 152, Universidade do Porto, Faculdade de Economia do Porto.
  32. Levin, Andrew & Raut, Lakshmi K, 1997. "Complementarities between Exports and Human Capital in Economic Growth: Evidence from the Semi-industrialized Countries," Economic Development and Cultural Change, University of Chicago Press, vol. 46(1), pages 155-74, October.
  33. Jorge Crespo & Carmela Martin & Francisco Javier Velázquez, 2002. "International technology diffusion through imports and its impact on economic growth," European Economy Group Working Papers 12, European Economy Group.
  34. Mireille Laroche & Marcel Mérette, . "Measuring Human Capital in Canada," Working Papers-Department of Finance Canada 2000-05, Department of Finance Canada.
  35. Frank R. Lichtenberg, 1992. "R&D Investment and International Productivity Differences," NBER Working Papers 4161, National Bureau of Economic Research, Inc.
  36. Alwyn Young, 1991. "Learning by Doing and the Dynamic Effects of International Trade," NBER Working Papers 3577, National Bureau of Economic Research, Inc.
  37. Abramovitz, Moses, 1993. "The Search for the Sources of Growth: Areas of Ignorance, Old and New," The Journal of Economic History, Cambridge University Press, vol. 53(02), pages 217-243, June.
  38. Coe, David T & Helpman, Elhanan & Hoffmaister, Alexander W, 1997. "North-South R&D Spillovers," Economic Journal, Royal Economic Society, vol. 107(440), pages 134-49, January.
  39. Ben-David, D., 1995. "Trade and Convergence Among Countries," Papers 35-95, Tel Aviv.
  40. Abramovitz, Moses, 1986. "Catching Up, Forging Ahead, and Falling Behind," The Journal of Economic History, Cambridge University Press, vol. 46(02), pages 385-406, June.
  41. Kormendi, Roger C. & Meguire, Philip G., 1985. "Macroeconomic determinants of growth: Cross-country evidence," Journal of Monetary Economics, Elsevier, vol. 16(2), pages 141-163, September.
  42. Costas Azariadis & Allan Drazen, 1990. "Threshold Externalities in Economic Development," The Quarterly Journal of Economics, Oxford University Press, vol. 105(2), pages 501-526.
  43. Aurora Teixeira & Natércia Fortuna, 2003. "Human Capital, Innovation Capability and Economic Growth," FEP Working Papers 131, Universidade do Porto, Faculdade de Economia do Porto.
  44. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
  45. Hans-Jurgen Engelbrecht, 2002. "Human capital and international knowledge spillovers in TFP growth of a sample of developing countries: an exploration of alternative approaches," Applied Economics, Taylor & Francis Journals, vol. 34(7), pages 831-841.
  46. Harald Badinger, 2005. "Growth Effects of Economic Integration: Evidence from the EU Member States," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 141(1), pages 50-78, April.
  47. Romer, Paul M., 1990. "Human capital and growth: Theory and evidence," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 32(1), pages 251-286, January.
  48. Lains, Pedro, 2003. "Catching up to the European core: Portuguese economic growth, 1910-1990," Explorations in Economic History, Elsevier, vol. 40(4), pages 369-386, October.
  49. João Paulo Pereira, 2005. "Measuring Human Capital in Portugal," Notas Económicas, Faculdade de Economia, Universidade de Coimbra, issue 21, pages 16-34, June.
  50. Luis A. Rivera-Batiz & Paul M. Romer, 1991. "Economic Integration and Endogenous Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 531-555.
  51. Howard Pack, 1994. "Endogenous Growth Theory: Intellectual Appeal and Empirical Shortcomings," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 55-72, Winter.
  52. Temple, Jonathan, 1998. "Equipment Investment and the Solow Model," Oxford Economic Papers, Oxford University Press, vol. 50(1), pages 39-62, January.
  53. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
  54. David A. Dickey & Dennis W. Jansen & Daniel L. Thornton, 1991. "A primer on cointegration with an application to money and income," Review, Federal Reserve Bank of St. Louis, issue Mar, pages 58-78.
  55. Rivera-Batiz, Luis A. & Xie, Danyang, 1993. "Integration among unequals," Regional Science and Urban Economics, Elsevier, vol. 23(3), pages 337-354, July.
  56. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-72, June.
  57. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
  58. Xu, Bin, 2000. "Multinational enterprises, technology diffusion, and host country productivity growth," Journal of Development Economics, Elsevier, vol. 62(2), pages 477-493, August.
  59. Baldwin, Richard, 1993. "The Potential for Trade Between the Countries of EFTA and Central and Eastern Europe," CEPR Discussion Papers 853, C.E.P.R. Discussion Papers.
  60. Eric A. Hanushek, 1996. "Measuring Investment in Education," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 9-30, Fall.
  61. Chuang, Yih-chyi, 2000. "Human Capital, Exports, and Economic Growth: A Causality Analysis for Taiwan, 1952-1995," Review of International Economics, Wiley Blackwell, vol. 8(4), pages 712-20, November.
  62. Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:por:fepwps:226. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.