Monday 6 October 2008

Technology's economic characterisation

The effect on growth of technology gaps between two countries depends on the type of technology. So gaps in computers have different effects from gaps in telephones. I will post a research paper on Great Lakes Economics soon showing the different impacts.

The technologies could be characterised in terms of the effects, but it would be better to have more intrinsic determinants which could be included in a model to explain the different growth effects. Thus, a vector X of successful characterising determinants would satisfy

growth =
a.vector of change in basic output determinants + b.X + c.indicator vector of technology types + error

where a, b, and c are constant vectors, and c should be tested as statistically insignificant.

I am not sure what X should be.

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