The Spatial Diffusion of Technology

Mikhail Dmitriev, Diego Comin and Esteban Rossi-Hansberg

No 9208, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We study empirically technology diffusion across countries and over time. We find significant evidence that technology diffuses slower to locations that are farther away from adoption leaders. This effect is stronger across rich countries and also when measuring distance along the south-north dimension. A simple theory of human interactions can account for these empirical findings. The theory suggests that the effect of distance should vanish over time, a hypothesis that we confirm in the data, and that distinguishes technology from other flows like goods or investments. We then structurally estimate the model. The parameter governing the frequency of interactions is larger for newer and network-based technologies and for the median technology the frequency of interactions decays by 73% every 1000 Kms. Overall, we document the significant role that geography plays in determining technology diffusion across countries.

Keywords: Geography; Human interactions; Technology diffusion (search for similar items in EconPapers)
JEL-codes: O3 R0 (search for similar items in EconPapers)
Date: 2012-11
New Economics Papers: this item is included in nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (125)

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Working Paper: The Spatial Diffusion of Technology (2012)
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