Complementarity between human capital and trade in regional technological progress

Guadalupe Serrano, Enrique Lopez-Bazo and Jose Ramon Garcia Sanchi
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Jose Ramon Garcia Sanchi: Universitat de Barcelona

No 83, Working Papers in Economics from Universitat de Barcelona. Espai de Recerca en Economia

Abstract: The effect of openness and trade orientation on economic growth remains a highly contentious issue in the literature. Trade facilitates the spread of knowledge and the adoption of more advanced and efficient technologies, which hastens total factor productivity (TFP) growth and, hence, per capita income. New technologies that spread through trade require a sufficiently skilled labour force to adapt them to the domestic productive environment. Thus, openness and human capital accumulation will lead to TFP growth and the greater the complementarity between both variables, the higher the TFP growth. This paper discusses the implications of these assumptions and tests their empirical validity, using a pool of data for manufacturing industry in Spanish regions in a period in which both the stock of human capital and openness experienced a notable increase.

JEL-codes: F10 H21 H77 O47 R11 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2002
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Citations: View citations in EconPapers (2)

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