While there is general agreement that technology differences must figure prominently in any successful account of the cross-country income variation, not much is known on the source of these technology differences. This paper examines cross-country income differences in terms of factor...

This paper presents and tests a new model of multinational firms to explain a rich array of multinational behavior. In contrast to most approaches, here the multinational faces costs to transferring its know-how that are increasing in technological complexity. Costly technology transfer gives...

The practice of sourcing service inputs from overseas suppliers has been growing in response to new technologies. This paper estimates the effects of offshoring on productivity in US manufacturing industries between 1992 and 2000, using instrumental variables estimation to address the potential...

When local cost discovery generates knowledge spillovers, specialization patterns become partly indeterminate and the mix of goods that a country produces may have important implications for economic growth. We demonstrate this proposition formally and adduce some empirical support for it. We...

The increased integration of the economies of Central and Eastern Europe with the European Union (EU) as the Europe Agreements are progressively implemented, is projected to have a significant impact on trade flows with Spain, as exports and imports grow very rapidly, albeit starting from a very...

Development accounting exercises based on an aggregate production function find technology is biased in favour of a country's abundant production factors. We provide an explanation to this finding based on the Heckscher-Ohlin model. Countries trade and specialize in the industries that use...

In this paper we analyse productivity spillovers from foreign direct investment using firm level panel data UK manufacturing industries from 1992 to 1999. We investigate spillovers through horizontal, backward and forward linkages, distinguish spillovers from export oriented vs domestic market...

The theoretical framework presented here preserves many of the primary features of the standard neo-classical model, while introducing some modifications that transform it into an open economy endogenous growth model with knowledge accumulation. Knowledge accumulation is determined in part by...

Mozambique liberalized its cashew sector in the early 1990s in response to pressure from the World Bank. Opponents of the reform have argued that the policy did little to benefit poor cashew farmers while bankrupting factories in urban areas. Using a welfare-theoretic framework, we analyse the...

This paper analyses the impact of cost competitiveness and technology on export performance using a very rich panel dataset of 12 manufacturing industries in 14 OECD countries for the period between 1970 and 1992. Consistent with standard models, we find that changes in relative unit labour...