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• Case | HBS Case Collection | 2013 (Revised from original 2011 version)

  South Africa (A): Stuck in the Middle?

  Richard H. K. Vietor and Diego Comin

  Fifteen years after ending apartheid, formal unemployment in South Africa was still at 24%. While the country had grown at 4 to 5% annually during the 2000s, the financial crisis set it back by 1 million more unemployed. Moreover, it seemed as if the nation were stuck between low wage and fully developed competitors. The government of Jacob Zuma has just adopted a "New Growth Path," hoping to create several million jobs over the next few years. Both the Finance Minister and the head of the Central Bank support the initiative, but worry how they can sustain fiscal discipline and control inflation, in light of these stimulative policies. Organized labor, meanwhile, has little sympathy for any sort of sacrifice.

  Keywords: Financial Crisis; Inflation and Deflation; Policy; Employment; Wages; Competition; South Africa;

  Citation:

  Vietor, Richard H. K., and Diego Comin. "South Africa (A): Stuck in the Middle?" Harvard Business School Case 711-084, May 2013. (Revised from original April 2011 version.)

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• Supplement | HBS Case Collection | 2012 (Revised from original 2011 version)

  South Africa (B): Getting Unstuck?

  Richard H. K. Vietor and Diego Comin

  15 years after ending apartheid, formal unemployment in South Africa was still at 24%. While the country had grown at 4 to 5% annually during the 2000s, the financial crisis set it back by 1 million more unemployed. Moreover, it seemed as if the nation were stuck between low wage and fully developed competitors. The government of Jacob Zuma has just adopted a "New Growth Path," hoping to create several million jobs over the next few years. Both the Finance Minister and the head of the Central Bank support the initiative, but worry how they can sustain fiscal discipline and control inflation, in light of these stimulative policies. Organized labor, meanwhile, has little sympathy for any sort of sacrifice.

  Keywords: Financial Crisis; Inflation and Deflation; Policy; Employment; Wages; Competition; South Africa;

  Citation:

  Vietor, Richard H. K., and Diego Comin. "South Africa (B): Getting Unstuck?" Harvard Business School Supplement 711-085, December 2012. (Revised from original April 2011 version.)

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• Working Paper | 2012

  The Spatial Diffusion of Technology

  Diego A. Comin, Mikhail Dmitriev and Esteban Rossi-Hansberg

  We empirically study technology diffusion across countries and over time. We find significant evidence that technology diffuses slower to locations that are farther away from adoption leaders. This effect is stronger across rich countries and also when measuring distance along the south-north dimension. A simple theory of human interactions can account for these empirical findings. The theory suggests that the effect of distance should vanish over time, a hypothesis that we confirm in the data and that distinguishes technology from other flows like goods or investments. We then structurally estimate the model. The parameter governing the frequency of interactions is larger for newer and network-based technologies, and for the median technology, the frequency of interactions decays by 73% every 1000 kms. Overall, we document the significant role that geography plays in determining technology diffusion across countries.

  Keywords: Economic Growth; Knowledge Dissemination; Technology Adoption;

  Citation:

  Comin, Diego A., Mikhail Dmitriev, and Esteban Rossi-Hansberg. "The Spatial Diffusion of Technology." NBER Working Paper Series, No. 18534, November 2012.

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