Many writers have claimed that R&D has two 'faces'. In addition to the conventional role of stimulating innovation, R&D enhances technology transfer by improving the ability of firms to learn about advances in the leading edge ('absorptive capacity'). In this paper we document that there has...

This paper models technology adoption as replacing workers by machines, which perform the same job in the production process. The paper shows that such modelling of technology adoption affects significantly the analysis of economic growth. This model can explain large and persistent...