The Spatial Diffusion of Technology

41 Pages Posted: 20 Nov 2012 Last revised: 22 Feb 2023

See all articles by Diego A. Comin

Diego A. Comin

Harvard Business School - Business, Government and the International Economy Unit

Mikhail Dmitriev

Boston College

Esteban Rossi-Hansberg

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: November 2012

Abstract

We study empirically technology diffusion across countries and over time. We find significant evidence that technology diffuses slower to locations that are farther away from adoption leaders. This effect is stronger across rich countries and also when measuring distance along the south-north dimension. A simple theory of human interactions can account for these empirical findings. The theory suggests that the effect of distance should vanish over time, a hypothesis that we confirm in the data, and that distinguishes technology from other flows like goods or investments. We then structurally estimate the model. The parameter governing the frequency of interactions is larger for newer and network-based technologies and for the median technology the frequency of interactions decays by 73% every 1000 Kms. Overall, we document the significant role that geography plays in determining technology diffusion across countries.

Suggested Citation

Comin, Diego A. and Dmitriev, Mikhail and Rossi-Hansberg, Esteban A., The Spatial Diffusion of Technology (November 2012). NBER Working Paper No. w18534, Available at SSRN: https://ssrn.com/abstract=2178293

Diego A. Comin (Contact Author)

Harvard Business School - Business, Government and the International Economy Unit ( email )

Cambridge
United States

Mikhail Dmitriev

Boston College ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

Esteban A. Rossi-Hansberg

University of Chicago - Department of Economics

1126 East 59th Street
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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