scholarly journals If Technology Has Arrived Everywhere, Why Has Income Diverged?

2018 ◽  
Vol 10 (3) ◽  
pp. 137-178 ◽  
Author(s):  
Diego Comin ◽  
Martí Mestieri
Keyword(s):  
Technology Diffusion ◽  
Aggregate Productivity ◽  
Poor Countries ◽  
Income Divergence ◽  
Evolution Of Technology ◽  
World Income ◽  
World Income Distribution ◽  
Cross Country ◽  
The Cross ◽  
Rich Countries

We study the cross-country evolution of technology diffusion over the last two centuries. We document that adoption lags between poor and rich countries have converged, while the intensity of use of adopted technologies of poor countries relative to rich countries has diverged. The evolution of aggregate productivity implied by these trends in technology diffusion resembles the actual evolution of the world income distribution in the last two centuries. Cross-country differences in adoption lags account for a significant part of the cross-country income divergence in the nineteenth century. The divergence in intensity of use accounts for the divergence during the twentieth century. (JEL N10, N70, O14, O33, O41, O47)

scholarly journals On the Evolution of the World Income Distribution

1997 ◽  
Vol 11 (3) ◽  
pp. 19-36 ◽  
Author(s):  
Charles I Jones
Keyword(s):  
World War I ◽  
Income Distribution ◽  
The United States ◽  
Poor Countries ◽  
The World ◽  
The Future ◽  
Future Income ◽  
World Income ◽  
World Income Distribution ◽  
Rich Countries

The post-World War I period has seen substantial changes in the world income distribution. As a result, the shape of the distribution has changed from something that looks like a normal distribution in 1960 to a bimodal 'twin peaks' distribution in 1988. Projecting these changes into the future suggests a number of interesting findings. First, it seems likely that the United States will lose its position as the country with the highest level of GDP per worker. Second, the future income distribution will involve far more 'rich' countries and far fewer 'poor' countries than currently observed.

scholarly journals The World Technology Frontier

2006 ◽  
Vol 96 (3) ◽  
pp. 499-522 ◽  
Author(s):  
Francesco Caselli ◽  
Wilbur John Coleman
Keyword(s):  
Skilled Labor ◽  
Simple Explanation ◽  
Unskilled Labor ◽  
Skilled Workers ◽  
Poor Countries ◽  
Aggregate Production Function ◽  
Unskilled Workers ◽  
Cross Country ◽  
Rich Countries ◽  
Lower Income Countries

We study cross-country differences in the aggregate production function when skilled and unskilled labor are imperfect substitutes. We find that there is a skill bias in cross-country technology differences. Higher-income countries use skilled labor more efficiently than lower-income countries, while they use unskilled labor relatively and, possibly, absolutely less efficiently. We also propose a simple explanation for our findings: rich countries, which are skilled-labor abundant, choose technologies that are best suited to skilled workers; poor countries, which are unskilled-labor abundant, choose technologies more appropriate to unskilled workers. We discuss alternative explanations, such as capital-skill complementarity and differences in schooling quality.

scholarly journals Inventory Management, Product Quality, and Cross‑Country Income Differences

2019 ◽  
Vol 11 (1) ◽  
pp. 338-388 ◽  
Author(s):  
Bernardo S. Blum ◽  
Sebastian Claro ◽  
Kunal Dasgupta ◽  
Ignatius J. Horstmann
Keyword(s):  
Product Quality ◽  
Inventory Management ◽  
Reduced Form ◽  
Poor Countries ◽  
Quality Upgrading ◽  
Country Differences ◽  
Cross Country ◽  
Export Destination ◽  
The One ◽  
Rich Countries

Previous research has documented that export shipments are “lumpy”— exporters make infrequent and relatively large shipments to any given export destination. This fact has been interpreted as implying that fixed, per shipment cost and inventory management decisions play a key role in international trade. We document here that exports from poor countries are considerably more lumpy—have higher fixed per shipment cost— than those from rich countries. Using a model of trade with inventory management, we estimate that the country at the ninetieth percentile of the distribution of per shipment costs has almost three times higher costs than the one at the tenth percentile. We show that these per shipment cost differences have a reduced-form representation given by an ad  valorem trade cost that varies with export country income (as in Waugh 2010 ). A calibrated version of the model that incorporates these estimates and allows for endogenous product quality reveals that cross-country differences in per shipment costs explain almost 40 percent of the observed cross-country differences in income. It also shows that policies that lower per shipment costs can lead to significant welfare gains, mainly due to induced quality upgrading. (JEL F12, F14, F43, G31, O16, O19)

scholarly journals International Technology Diffusion

2004 ◽  
Vol 42 (3) ◽  
pp. 752-782 ◽  
Author(s):  
Wolfgang Keller
Keyword(s):  
Technology Diffusion ◽  
Technical Change ◽  
New Technology ◽  
Income Convergence ◽  
International Diffusion ◽  
Domestic Technology ◽  
International Technology Diffusion ◽  
Cross Country ◽  
Technology Investments ◽  
Rich Countries

This paper surveys what is known about the extent of international technology diffusion and channels through which technology spreads. Productivity differences explain much of the variation in incomes across countries, and technology plays a key role in determining productivity. The pattern of worldwide technical change is determined largely by international technology diffusion because a few rich countries account for most of the world's creation of new technology. Cross-country income convergence turns on whether technology diffusion is global or local. There is no indication that international diffusion is inevitable or automatic, but rather, domestic technology investments are necessary. Better understanding of what determines the effectiveness of technology diffusion sheds light on the pace at which the world's technology frontier may expand.

scholarly journals Cross-Country Income Levels over Time: Did the Developing World Suddenly Become Much Richer?

2017 ◽  
Vol 9 (1) ◽  
pp. 265-290 ◽  
Author(s):  
Robert Inklaar ◽  
D.S. Prasada Rao
Keyword(s):  
Relative Income ◽  
Lower Income ◽  
Relative Prices ◽  
Income Levels ◽  
The World ◽  
Measurement Methodology ◽  
World Income ◽  
World Income Distribution ◽  
Cross Country ◽  
Lower Income Countries

The latest global survey on relative prices and income levels, for the year 2011, showed changes to relative income levels that were larger in lower income countries, thereby narrowing the world income distribution compared to estimates based on the previous, 2005, survey. This paper examines whether changes in measurement methodology between the 2005 and 2011 survey can explain these large differences. We construct a counterfactual set of relative prices for 2005 that harmonizes measurement, and we no longer find systematic differences across income levels, implying that international income inequality based on the 2005 survey was overstated. (JEL C82, D31, E01, E23, E31, O11)

GROWTH AND CONVERGENCE THROUGH TECHNOLOGICAL INTERDEPENDENCE

2020 ◽  
pp. 1-37
Author(s):  
Wei Jin ◽  
Yixiao Zhou
Keyword(s):  
Initial Conditions ◽  
Structural Characteristics ◽  
Balanced Growth ◽  
Long Run ◽  
World Income ◽  
World Income Distribution ◽  
Catch Up ◽  
Per Capita ◽  
Cross Country ◽  
Country Specific

This paper presents a multi-country version of the Ramsey growth model with cross-country technological interdependence. The results rationalize several stylized facts about growth and convergence. First, individual countries tend to converge toward country-specific balanced growth paths rather than steady-state equilibria. Second, an economy that accounts for a smaller share of the world technology distribution harnesses the “advantages of backwardness” to catch up at a faster speed. Third, countries grow at different rates during the phase of transitional dynamics. However, technological interdependence creates a force toward cross-country convergence in the growth rate and stability of world income distribution in the long run. Finally, cross-country differences in structural characteristics and initial conditions lead to divergences in the level of income per capita.

scholarly journals The Size Distribution of Farms and International Productivity Differences

2014 ◽  
Vol 104 (6) ◽  
pp. 1667-1697 ◽  
Author(s):  
Tasso Adamopoulos ◽  
Diego Restuccia
Keyword(s):  
Size Distribution ◽  
Farm Size ◽  
Aggregate Productivity ◽  
Country Differences ◽  
Cross Country ◽  
The Cross ◽  
Size Distortions ◽  
Price Distortions

We study the determinants of differences in farm size across countries and their impact on agricultural and aggregate productivity using a quantitative sectoral model featuring a distribution of farms. Measured aggregate factors (capital, land, economy-wide productivity) account for one-quarter of the observed differences in farm size and productivity. Policies and institutions that misallocate resources across farms have the potential to account for the remaining differences. Exploiting within-country variation in crop-specific price distortions and their correlation with farm size, we construct a cross-country measure of farm-size distortions which together with aggregate factors accounts for one-half of the cross-country differences in size and productivity. (JEL D24, J24, J43, L11, O13, Q12, Q18)

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