Research Summary

Technology Adoption



How large are cross-country differences in technology adoption? How important are they to explain the large observed cross-country differences in per capita income? What factors accelerate of slowdown the adoption of technology? What factors affect the shape of the diffusion of technology?

To answer these questions I have put together several historical data sets on technology adoption and develop new models that allow me to map the micro data to macro aggregates such as labor productivity and total factor productivity (TFP). In several papers I have documented that cross-country differences in technology adoption are even larger than cross-country differences in per-capita income. They are also very persistent. Technology adoption history as far back as 1500 AD can account for a significant fraction of current development. Similarly, current technology adoption differences may account for at least 25% of cross-country variation in current per-capita income. Many factors affect the speed of technology adoption. Two that I have studied are lobbies and capital markets. Both of them seem to have an important effect especially in rich countries. In Developing countries, it seems that private savings are important to attract foreign investors with familiarity in frontier technology.