International technology diffusion and economic growth: Explaining the spillover benefits to developing countries

Abdoulaye Seck

Structural Change and Economic Dynamics, 2012, vol. 23, issue 4, 437-451

Abstract: Technology spillovers offer great opportunities for economic growth to developing countries that do little, if any, R&D activity. This paper explores the extent to which these countries benefit from foreign technology, the diffusion mechanisms involved, and the factors that shape their absorption capabilities. Results based on a non-stationary panel of 55 developing countries indicate that the benefits are quite substantial: a ten-percent increase in foreign R&D stock is translated into more than a two-percent increase in aggregate productivity. Of the diffusion channels considered, imports appear to be more conducive to R&D spillover. In addition, developing countries that enjoy larger benefits tend to exhibit larger stock of human capital, more openness to trade and foreign activities, and stronger institutions. These North–South R&D spillovers, although larger than previously suggested, appear less strong than North–North spillovers, adding to the general literature on economic divergence between developed and developing countries.

Keywords: R&D spillover; TFP; Developing countries; Non-stationary panel (search for similar items in EconPapers)
JEL-codes: F4 O3 O4 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (37)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:streco:v:23:y:2012:i:4:p:437-451

DOI: 10.1016/j.strueco.2011.01.003

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