Working paper

If Technology Has Arrived Everywhere, Why Has Income Diverged?

Diego Comin, and Marti Mestieri

Abstract

If Technology Has Arrived Everywhere, Why Has Income Diverged? We study the lags with which new technologies are adopted across countries, and their long-run penetration rates once they are adopted. Using data from the last two centuries, we document two new facts: there has been convergence in adoption lags between rich and poor countries, while there has been divergence in penetration rates. Using a model of adoption and growth, we show that these changes in the pattern of technology diffusion account for 80% of the Great Income Divergence between rich and poor countries since 1820.

JEL codes

  • E13: Neoclassical
  • O14: Industrialization • Manufacturing and Service Industries • Choice of Technology
  • O33: Technological Change: Choices and Consequences • Diffusion Processes
  • O41: One, Two, and Multisector Growth Models

Reference

Diego Comin, and Marti Mestieri, If Technology Has Arrived Everywhere, Why Has Income Diverged?, TSE Working Paper, n. 13-409, May 2013.

See also

Published in

TSE Working Paper, n. 13-409, May 2013