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Convergent Economies: Implications for World Energy Use

  • Patrik T. Hultberg
  • Robin C. Sickles
Part of the Euro-Asian Studies book series (EAS)

Abstract

The neoclassical model predicts that countries converge to their own steady states. Assuming identical technologies across countries, this implies that exogenous differences in savings (investment), employment, and education cause the observed differences in levels of income and rates of growth. However, countries differ not only in accumulation rates, but also use different technologies. In fact, hardly any group of countries fits the assumption of identical technologies. The existence of a technology gap may therefore present an additional opportunity for growth through technology flows. If so, then a nation’s ability to adopt and absorb new knowledge must also be considered. Indeed, if “follower” countries are characterized by large technology gaps and low and variable absorption capacities, then predictions about rate of growth will be ambiguous. Abramovitz (1986) proposes that the ability of countries to take advantage of the catching-up potential depends on their respective “social capabilities”; that systematic variations in social institutions make some countries better or worse at catching up. The institutional economics literature also highlights the importance of the security of property rights and the efficiency of government policies as determinants of countries’ growth rates (North, 1990; Olson, 1982).

Keywords

Panel Data Capital Stock Technology Adoption Adoption Rate Caspian Region 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Robin C. Sickles and Patrick T. Hultberg 2002

Authors and Affiliations

  • Patrik T. Hultberg
  • Robin C. Sickles

There are no affiliations available

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