Kiel Working Papers, Kiel Institute for World Economics
No 1477:
Avoiding the Trap: The Dynamic Interaction of North-South Capital Mobility and Technology Diffusion
Michael Hübler
Abstract: This paper analyzes a stylized model of international
capital mobility and diffusion of embodied technologies from North to
South. The South can fall behind in terms of technologies or get trapped in
a situation, in which it is unable to attract foreign capital and embodied
technologies, if its absorptive capacity is too low. The paper reconciles
the view that technological catching up is stronger, the larger the
technology gap, with the alternative view that technological catching up is
strongest at a medium technology gap. The closer the South is to the
technology frontier, the more beneficial is a higher income share of
foreign capital. The speed of technology diffusion is higher in small
economic regions with high population densities
Keywords: Technology diffusion, technology transfer, capital mobility, human capital, absorptive, capacity; (follow links to similar papers)
JEL-Codes: F21,; O11,; O33,; O47; (follow links to similar papers)
30 pages, January 2009
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