Wake Up and Smell the Ginseng: The Rise of Incremental Innovation in Low-Wage Countries

Diego Puga and Daniel Trefler

No 5286, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Increasingly, a small number of low-wage countries such as China and India are involved in innovation - not the `big ideas', but the constant incremental innovations needed to stay ahead in business. We provide some evidence of this and develop a model in which there is a transition from old-style product-cycle trade to trade involving incremental innovation in low-wage countries. We explain why levels of involvement in innovation vary across low-wage countries and even across firms in each low-wage country. We then draw out the implications of this for the location of production, trade, capital flows, earnings and living standards.

Keywords: International trade; Low-wage country innovation (search for similar items in EconPapers)
JEL-codes: F1 (search for similar items in EconPapers)
Date: 2005-10
New Economics Papers: this item is included in nep-cna, nep-ino, nep-int, nep-lab, nep-sea and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
https://cepr.org/publications/DP5286 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Working Paper: Wake Up and Smell the Ginseng: The Rise of Incremental Innovation in Low-Wage Countries (2005)
Working Paper: Wake up and smell the ginseng: The rise of incremental innovation in low-wage countries (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:5286

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP5286

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().