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Why Technological Spillovers elude Developing Countries A Dynamic Non-linear Model

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  • Watu Wamae

Abstract

This paper attempts to theoretically understand the process of catching-up or falling behind particularly within the context of developing countries. The main aim of the paper consists in investigating the impact of domestic innovation, via its interaction with the learning capability, on the technology gap of an economy. More specifically, we seek to shed some light on why the tendency for poor countries to fall further behind, despite efforts to improve their learning capabilities, appears pervasive. Our analysis is based on a simple model of technology gap elaborated by Verspagen (1991). We find that domestic innovation, a critical component for the development of an absorptive capacity, is a significant determinant of whether an economy catches-up or falls further behind.

Suggested Citation

  • Watu Wamae, 2006. "Why Technological Spillovers elude Developing Countries A Dynamic Non-linear Model," DRUID Working Papers 06-02, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    • Handle: RePEc:aal:abbswp:06-02
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    References listed on IDEAS

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    More about this item

    Keywords

    Technology gap; absorptive capacity; developing countries;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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