If Technology Has Arrived Everywhere, Why Has Income Diverged?

Comin, Diego; Mestieri, Marti

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If Technology Has Arrived Everywhere, Why Has Income Diverged?

CEPR Discussion Paper No. DP9466

67 Pages Posted: 8 May 2013

See all articles by Diego Comin

Diego Comin

Harvard University - Business School (HBS)

Marti Mestieri

University of Toulouse 1 - Toulouse School of Economics (TSE)

Date Written: May 2013

Abstract

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.

Keywords: great divergence, technology diffusion, transitional dynamics

JEL Classification: E13, O14, O33, O41

Suggested Citation: Suggested Citation

Comin, Diego and Mestieri, Marti, If Technology Has Arrived Everywhere, Why Has Income Diverged? (May 2013). CEPR Discussion Paper No. DP9466, Available at SSRN: https://ssrn.com/abstract=2262168