Working Paper: NBER ID: w8713
Authors: David E. Bloom; David Canning; Jaypee Sevilla
Abstract: Technological diffusion implies a form of 'conditional convergence' as lagging countries catch up with technological leaders. We find strong evidence of technological diffusion but not full convergence; differences in total factor productivity (TFP) persist even in the long run due to differences in geography and institutions. TFP differentials explain a large part of cross-country income differences in our model; our estimates of the rate of return to capital, labor and schooling are completely consistent with micro-economic studies, implying the absence of externalities in aggregate production.
Keywords: No keywords provided
JEL Codes: O3; O4
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Technological diffusion (O33) | Conditional convergence (O47) |
| TFP differentials (F16) | Cross-country income differences (F40) |
| TFP (F16) | Economic growth (O49) |
| TFP convergence (F16) | Economic growth (O00) |
| Geographic and institutional factors (R12) | TFP differentials (F16) |
| Inputs and TFP (F16) | GDP (E20) |