Technology Adoption and Catch-Up

Abstract

So far technology in agriculture has either been assumed as growing exogenously (chapter 3) or as being immediately adopted after invention (chapter 4). While this has provided some insights about growth and structural change it has totally neglected the process of technology adoption itself which can be defined as “the process of spread of a new technology within a region” (Feder, Just, and Zilberman, 1984, 257). In this chapter the models derived previously are modified to discuss technology adoption in agriculture. The questions we want to answer are: How does an economy’s growth behavior and its structure change if technology is adopted from some technologically superior country instead of being created from scratch? Does convergence, a catch-up to income level and growth rate of this leading country take place? If yes, what determines extend and speed of this convergence? What effects do economic policies to increase technology adoption have? As before, we focus only on the agricultural sector, although similar questions can be asked about industry.