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WELFARE EFFECTS OF TECHNOLOGY TRANSFER
Author(s) -
Takarada Yasuhiro
Publication year - 2006
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/j.1468-0106.2006.00300.x
Subject(s) - harm , technology transfer , economics , welfare , production (economics) , general equilibrium theory , microeconomics , public economics , industrial organization , market economy , international trade , law , political science
. This paper examines the welfare effects of aid tied to technology transfer in a two‐country general equilibrium model. In the recipient country, some factors of production employed in a particular industry are difficult to use in other industries because their properties are specific to that industry. Technology transfer facilitates ‘factor movement’ and improves the efficiency of factor markets in the recipient. We identify and interpret the conditions under which technology transfer benefits the recipient and harms the donor. We also show that technology transfer can enrich (or harm) both the donor and the recipient under certain conditions.