Appropriate Technology and Growth

Susanto Basu and David Weil

No 5865, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We present a model of growth and technology transfer based on the idea that technologies are specific to particular combinations of inputs. We argue that this model is more realistic than the usual specification, in which an improvement in any technique for producing a given good improves all other techniques for producing that good. Our model implies that technology improvements will diffuse only slowly, even if there are no barriers to the flow of knowledge and no adoption costs. On the other hand, although our basic production technology is of the `Ak' variety, technology diffusion implies that countries with identical policies and different initial incomes do eventually converge to the same level of per-capita income. We argue that a model with appropriate technology and technology diffusion is more appealing, and has more realistic predictions for long-run convergence and growth, than either the standard neoclassical model or simple endogenous-growth models.

Date: 1996-12
Note: EFG
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Citations: View citations in EconPapers (11)

Published as Quarterly Journal of Economics (November 1998).

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Journal Article: Appropriate Technology and Growth (1998)
Working Paper: Appropriate Technology and Growth (1996)
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