IDEAS home Printed from https://ideas.repec.org/p/red/sed016/1538.html
   My bibliography  Save this paper

The Global Diffusion of Ideas

Author

Listed:
  • Ezra Oberfield

    (Princeton University)

  • Francisco Buera

    (Federal Reserve Bank of Chicago)

Abstract

We provide a tractable theory of innovation and technology diffusion to explore the role of international trade in the process of development. We model innovation and diffusion as a process involving the combination of new ideas with insights from other industries or countries. We provide conditions under which each country’s equilibrium frontier of knowledge converges to a Frechet distribution, and derive a system of differ- ential equations describing the evolution of the scale parameters of these distributions, i.e., countries’ stocks of knowledge. In particular, the growth of a country’s stock of knowledge depends only on its trade shares and the stocks of knowledge of its trading partners. We use the framework to quantify the contribution of bilateral trade costs to cross-sectional TFP differences, long-run changes in TFP, and individual post-war growth miracles.

Suggested Citation

  • Ezra Oberfield & Francisco Buera, 2016. "The Global Diffusion of Ideas," 2016 Meeting Papers 1538, Society for Economic Dynamics.
  • Handle: RePEc:red:sed016:1538
    as

    Download full text from publisher

    File URL: https://economicdynamics.org/meetpapers/2016/paper_1538.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Mike Waugh & Christopher Tonetti & Jesse Perla, 2013. "Equilibrium Technology Diffusion, Trade, and Growth," 2013 Meeting Papers 484, Society for Economic Dynamics.
    2. König, Michael & Lorenz, Jan & Zilibotti, Fabrizio, 2016. "Innovation vs. imitation and the evolution of productivity distributions," Theoretical Economics, Econometric Society, vol. 11(3), September.
    3. Jonathan Chiu & Cesaire Meh & Randall Wright, 2017. "Innovation And Growth With Financial, And Other, Frictions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58, pages 95-125, February.
    4. Luigi Pascali, 2017. "The Wind of Change: Maritime Technology, Trade, and Economic Development," American Economic Review, American Economic Association, vol. 107(9), pages 2821-2854, September.
    5. Ezra Oberfield, 2011. "Business networks, production chains and productivity: A theory of input-output architecture," Working Paper Series WP-2011-12, Federal Reserve Bank of Chicago.
    6. Comin, Diego & Dmitriev, Mikhail & Rossi-Hansberg, Esteban, 2012. "The Spatial Diffusion of Technology," CEPR Discussion Papers 9208, C.E.P.R. Discussion Papers.
    7. Jesse Perla & Christopher Tonetti, 2014. "Equilibrium Imitation and Growth," Journal of Political Economy, University of Chicago Press, vol. 122(1), pages 52-76.
    8. Jesse Perla & Christopher Tonetti & Jess Benhabib, 2014. "The Growth Dynamics of Innovation, Diffusion, and the Technology Frontier," 2014 Meeting Papers 818, Society for Economic Dynamics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nan Li & Ana Maria Santacreu & Jie Cai, 2016. "Knowledge Diffusion and Trade Across Countries and Sectors," 2016 Meeting Papers 650, Society for Economic Dynamics.
    2. Nelson Lind & Natalia Ramondo, 2018. "Trade with Correlation," NBER Working Papers 24380, National Bureau of Economic Research, Inc.
    3. repec:eee:inecon:v:110:y:2018:i:c:p:63-86 is not listed on IDEAS
    4. Gordon H. Hanson & Nelson Lind & Marc-Andreas Muendler, 2015. "The Dynamics of Comparative Advantage," CESifo Working Paper Series 5622, CESifo Group Munich.
    5. Javier Mejia, 2018. "Social Interactions and Modern Economic Growth," Working Papers 20180021, New York University Abu Dhabi, Department of Social Science, revised Sep 2018.
    6. Busch, Berthold & Matthes, Jürgen, 2016. "Ökonomische Konsequenzen eines Austritts aus der EU: Am Beispiel des Brexits," IW-Analysen, Institut der deutschen Wirtschaft (IW) / German Economic Institute, volume 112, number 112.
    7. Nelson Lind & Natalia Ramondo, 2018. "Trade with Correlation," 2018 Meeting Papers 627, Society for Economic Dynamics.
    8. Foellmi, Reto & Hanslin Grossmann, Sandra & Kohler, Andreas, 2018. "A dynamic North-South model of demand-induced product cycles," Journal of International Economics, Elsevier, vol. 110(C), pages 63-86.
    9. Marina Mendes Tavares & Diego Restuccia & Jose-Maria Da-Rocha, 2014. "Policy Distortions and Aggregate Productivity with Endogenous Establishment-Level Productivity," 2014 Meeting Papers 1196, Society for Economic Dynamics.
    10. Naito, Takumi, 2017. "Growth and welfare effects of unilateral trade liberalization with heterogeneous firms and asymmetric countries," Journal of International Economics, Elsevier, vol. 109(C), pages 167-173.
    11. Jesse Perla & Christopher Tonetti, 2014. "Equilibrium Imitation and Growth," Journal of Political Economy, University of Chicago Press, vol. 122(1), pages 52-76.
    12. Pian Shu & Claudia Steinwender, 2019. "The Impact of Trade Liberalization on Firm Productivity and Innovation," Innovation Policy and the Economy, University of Chicago Press, vol. 19(1), pages 39-68.
    13. repec:bla:econom:v:86:y:2019:i:342:p:396-408 is not listed on IDEAS
    14. Cai, Jie & Li, Nan & Santacreu, Ana Maria, 2017. "Knowledge Diffusion, Trade and Innovation across Countries and Sectors," Working Papers 2017-29, Federal Reserve Bank of St. Louis, revised 07 Apr 2019.
    15. Nathaniel Baum-Snow & J. Vernon Henderson & Matthew A. Turner & Qinghua Zhang & Loren Brandt, 2018. "Does Investment in National Highways Help or Hurt Hinterland City Growth?," NBER Working Papers 24596, National Bureau of Economic Research, Inc.
    16. Tommaso Porzio, 2016. "Distance to the Technology Frontier and the Allocation of Talent," 2016 Meeting Papers 569, Society for Economic Dynamics.

    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:red:sed016:1538. 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: (Christian Zimmermann). General contact details of provider: http://edirc.repec.org/data/sedddea.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.