DP9466 If Technology Has Arrived Everywhere, Why Has Income Diverged?
|Author(s):||Diego Comin, Martí Mestieri|
|Publication Date:||May 2013|
|Keyword(s):||great divergence, technology diffusion, transitional dynamics|
|JEL(s):||E13, O14, O33, O41|
|Programme Areas:||International Macroeconomics, Development Economics, Economic History|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=9466|
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.