How does international trade affect technology diffusion? We show that tariff increases in Brazil lead to more international technology transfers to Brazilian firms and more citations to foreign patents. The highest increase in citations occurs among firms located near those receiving technology...

Over the last decades there has been a sizeable increase in trade and financial openness, triggered by current and capital account liberalization as well as improvements in transport and communication technologies. As a consequence, the importance of spillover effects is likely to have increased...