Technology Adoption and Factor Proportions in Open Economies: Theory and Evidence from the Global Computer Industry

47 Pages Posted: 20 Apr 2016

See all articles by Ana P. Cusolito

Ana P. Cusolito

World Bank

Daniel Lederman

World Bank - Latin America and Caribbean Region

Date Written: September 1, 2009

Abstract

Theories of international trade assume that all countries use similar and exogenous technologies in the production of any good. This paper relaxes this assumption. The marriage of literatures on biased technical change and trade yields a tractable theory, which predicts that differences in factor endowments and intellectual property rights bias technical change toward particular factor intensities, and thus unit factor input requirements can vary across economies. Using data on net exports of a single industry, computers, intellectual property rights and factor endowments for 73 countries during 1980-2000, the paper shows that once technological choices are considered, countries with different factor endowments can become net exporters of the same product.

Keywords: Technology Industry, Economic Theory & Research, ICT Policy and Strategies, E-Business, Labor Policies

Suggested Citation

Cusolito, Ana P. and Lederman, Daniel, Technology Adoption and Factor Proportions in Open Economies: Theory and Evidence from the Global Computer Industry (September 1, 2009). World Bank Policy Research Working Paper Series, Vol. , pp. -, 2009. Available at SSRN: https://ssrn.com/abstract=1471141

Ana P. Cusolito (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Daniel Lederman

World Bank - Latin America and Caribbean Region ( email )

1818 H Street NW
Washington, DC 20433
United States

HOME PAGE: http://sites.google.com/site/danielledermanworldbank/

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