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How to Reap the Induced Technological Bonus? A Mechanism and Illustrative Implementation

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DOI: 10.4236/me.2010.12008    4,437 Downloads   6,978 Views   Citations
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ABSTRACT

Exogenous technical progress can have uneven impacts on productivity contingent on absorptive capacity, structural congruence and trade intensity. The paper illustrates the role of enabling behind-the-border factors for effective absorption and is pertinent for discussing issues like ‘Europe 2020’or Lisbon strategy for inclusive growth. Drawing on our model, we illustrate that the capture-parameter is the propellant force for effective assimilation of foreign technology of recent vintage. The capture parameter is the outcome of endogenous decision-making process. The ‘productivity bonus’ mechanism leaves room for changing the results via skill-mix composition. However, it awaits implementation in a large-scale economy-wide modeling framework for further extension.

Conflicts of Interest

The authors declare no conflicts of interest.

Cite this paper

G. Das, "How to Reap the Induced Technological Bonus? A Mechanism and Illustrative Implementation," Modern Economy, Vol. 1 No. 2, 2010, pp. 80-88. doi: 10.4236/me.2010.12008.

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