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Are Asian technology gaps due to human capital quality differences?

Elsadig Ahmed () and Geeta Krishnasamy

Economic Modelling, 2013, vol. 35, issue C, 51-58

Abstract: This paper adopts the meta-frontier framework using DEAP software to analyse the technological gap and level of catch-up of the three regions in Asia (namely, Southern Asia, Eastern Asia and ASEAN5) with respect to the Asian technology as a whole for the period 1980–2006. Countries in Eastern Asia displayed a technology gap ratio of 1.000 which posits that this region defines the best practice frontier for Asia. Meanwhile, countries in Southern Asia region displayed an improvement in technical efficiency and productivity relative to the Asian frontier but lagged in terms of technological advancement. All three regions recorded a lag in technological advancement with respect to the best practice frontier. In order to progress technologically, these countries should be equipped with the necessary infrastructure and human capital to encourage foreign investment and growth. The countries in Eastern Asia and ASEAN5 recorded the strongest productivity growth performance as a group when compared to the countries in Southern Asia. In Southern Asia and ASEAN5 region, the technology gap ratio is below 1.000 subsequent to the 1997/98 financial crisis. On the contrary, East Asia kept up with the benchmark frontier during most of the sample period inclusive of the period after the financial crisis.

Keywords: Technical efficiency; Technological change; Productivity growth; Asia; Metafrontier; Technology gap; Human capital; DEA; Malmquist productivity index (search for similar items in EconPapers)
Date: 2013
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DOI: 10.1016/j.econmod.2013.06.032

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