North-South and South-South Trade-Related Technology Diffusion: How Important Are They in Improving TFP Growth?

Maurice Schiff and Yanling Wang

Journal of Development Studies, 2008, vol. 44, issue 1, 49-59

Abstract: This paper examines the impact on total factor productivity (TFP) growth in the South of North-South and South-South trade-related technology diffusion and of foreign direct investment (FDI). North-South and South-South trade-related research and development (R&D) stocks are constructed based on industry-specific R&D in the North, North-South and South-South trade patterns, and input-output relations in the South. The main findings are: 1. Both North-South and South-South trade-related R&D have a positive impact on TFP growth in the South; 2. FDI has a positive, though smaller, impact on TFP growth; 3. The impact on TFP growth of trade-related technology diffusion increases with the level of education in the case of North-South trade but not in the case of South-South trade.

Date: 2008
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DOI: 10.1080/00220380701722282

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