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The International Diffusion of New Technologies: A Multitechnology Analysis of Latecomer Advantage and Global Economic Integration

2005; American Association of Geographers; Volume: 95; Issue: 4 Linguagem: Inglês

10.1111/j.1467-8306.2005.00487.x

1467-8306

Richard Perkins, Eric Neumayer,

Economic Growth and Development

Abstract The diffusion of modern, efficient technology has far-reaching consequences for the geography of economic activity, inequality, and environmental quality. This article examines two popular yet highly controversial claims about the conditions most favorable to the rapid spread of new technology. The first states that latecomer advantage allows developing countries to diffuse new technology faster than developed countries. The second claim, widely articulated by advocates of neoliberal policy reform, is that new technologies diffuse more rapidly where countries are "open" to international trade and investment. To investigate these claims we use event-history analysis to estimate the determinants of diffusion speed across a large panel of developed and developing countries for three very different technologies. These are: continuous steel casting, shuttleless textile weaving looms, and digital telephone mainlines. Our results broadly support both propositions. Countries that adopt new technology later or have a smaller existing capital stock—characteristic features of developing countries—diffuse new technology more rapidly than countries that adopt earlier or have more installed capacity—two characteristics of developed countries. Trade openness is also found to influence the rate of diffusion positively for all three technologies. Yet, consistent with recent empirical studies, we fail to find support for the idea that foreign direct investment (FDI) accelerates the diffusion of new technology in host economies. The article concludes by discussing the geographical implications of our findings. Key Words: diffusionglobalizationindustrializationlatecomertechnology Acknowledgements Equal authorship. We would like to thank Joëlle Haine from the International Iron & Steel Institute (IISI) for her kind assistance in obtaining relevant steel statistics. We would also like to thank Mark Brayshay for his detailed and insightful remarks on an earlier draft of this article. Lastly, we thank three anonymous referees for many helpful and constructive comments. All errors are ours. Eric Neumayer acknowledges financial support from the Leverhulme Trust. Notes Notes: OECD=Organization for Economic Co-operation and Development. *0.05< α<0.10 **0.01< α<0.05 ***α<0.01 **0.01< α<0.05 ***α<0.01 *0.05< α<0.10 **0.01< α<0.05 ***α< 0.01 1. The terms "developing country,""late industrializer," and "latecomer" are used interchangeably throughout the present article. While we recognize the potential problems of dividing states into "developed" and "developing" categories—not least, because it conceals a great deal of diversity within and between these two groupings over space and time—it nevertheless serves a useful analytic purpose in the present context. 2. The use of country-specific initial adoption times is important since "many prior studies comparing within-country diffusion curves have failed to adjust for a comparable time of origin across countries" (CitationDekimpe, Parker, and Sarvary 2000c, 65). 3. Note that the idea of variable, technology-specific adoption "ceilings" is consistent with the empirical record, which reveals that individual technologies have very different penetration levels (see CitationGrübler 1997). 4. The OECD countries included in the sample encompass the United States, Canada, Western Europe, Japan, Australia, and New Zealand, but not Mexico, Turkey, and South Korea, as these were admitted to the club of developed countries for mainly political reasons in the 1990s. 5. Note that events that affect all countries, such as the conclusion of trade rounds in a certain year at the WTO, are absorbed by the baseline hazard of the Cox estimator.