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Technological catch-up: Gradual diffusion of technology and convergence in the neoclassical growth model

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  • Lorenzo Escot

Abstract

In this paper, I study the effects of the international gradual transmission of technology on the convergence processes among countries. In this way, the international gradual diffusion of technology makes possible a greater potential improvement capacity to the less developed country in its technological level. When this hypothesis is included in the Solow-Swan growth models, the paper shows that the convergence hypothesis will now be maintained only in the growth rates since a gap in income levels will remain in the long run. That conditional convergence will be explained by two factors: the diminishing returns for cumulative factor and the gradual diffusion of technology. I will finish this paper with empirical evidence of these two factors explaining convergence. Copyright International Atlantic Economic Society 1998

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  • Lorenzo Escot, 1998. "Technological catch-up: Gradual diffusion of technology and convergence in the neoclassical growth model," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 4(1), pages 24-33, February.
    • Handle: RePEc:kap:iaecre:v:4:y:1998:i:1:p:24-33:10.1007/bf02295233
    DOI: 10.1007/BF02295233
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