Kiel Working Papers, Kiel Institute for World Economics
No 1478:
The Optimal Transfer of Capital and Embodied Technologies to Developing Countries
Michael Hübler and Thomas S. Lontzek
Abstract: We study the North-South diffusion of technologies
embodied in internationally mobile capital in a framework of intertemporal
global welfare maximization. Convergence of the growth rates of technical
change in the North and South always occurs in the long-run. However, the
degree to which the North-South technology gap can be narrowed depends
crucially on the level of the absorptive capacity (human capital,
infrastructure, legal framework, etc.) in the South. Performing own
innovations in the South narrows the technology gap only in the short-run.
An optimal development policy requires more capital to be allocated to the
South in earlier stages of development. Allowing for optimal investment
into the absorptive capacity, the absorptive capacity rises steadily with
the aim to close the technology gap completely. Our results show that an
optimal development policy requires FDI to be matched by investment into
the absorptive capacity
Keywords: Technology diffusion, technology transfer, capital mobility, FDI, human capital, absorptive capacity; (follow links to similar papers)
JEL-Codes: F21,; O11,; O33,; O47; (follow links to similar papers)
30 pages, January 2009
Before downloading any of the electronic versions below
you should read our statement on
copyright.
Download GhostScript
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Downloadable files:
Hubler%20Lontzek%202009%2 ... gies%20-%20KWP%201478.pdf 
Download Statistics
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Programing by
Design Joakim Ekebom
