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Endogenous TFP and Cross-Country Income Differences

Juan Cordoba () and Marla Ripoll ()

Development and Comp Systems from EconWPA

Abstract: This paper explores the quantitative implications of a class of endogenous growth models for cross-country income differences. These models exhibit international spillovers, no scale effects and conditional convergence, and thus they overcome some difficulties faced by the early generation of endogenous growth models. Cross-country income differences arise in the model as the result of different distortions in the accumulation of rival factors of production, the objects, and in the accumulation of nonrival factor of production, the ideas. We show that object gaps play a much larger role to explain income gaps in models with endogenous TFP than in models with exogenous TFP. We also show, using a carefully calibrated version of the model, that most of the cross-country differences in output per worker are explained by barriers to the accumulation of rival factors (physical and human capital) rather than by barriers to the accumulation of knowledge.

Keywords: endogenous growth; technology diffusion (search for similar items in EconPapers)
JEL-codes: O10 O19 O40 O57 F43 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev
Date: 2005-12-20
Note: Type of Document - pdf; pages: 45
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http://econwpa.repec.org/eps/dev/papers/0512/0512018.pdf (application/pdf)

Related works:
Working Paper: Endogenous Tfp and Cross-Country Income Differences (2010)
Journal Article: Endogenous TFP and cross-country income differences (2008) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpdc:0512018

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