The Economic Impact of Technology Transfer in Developing Countries

Abstract

The aim of this paper is to offer an updated survey of theoretical models and empirical studies analysing the impact of technology transfer in developing countries. The transfer of technology from developed to developing countries depends on trade liberalization and internationalization of production through various channels. A critical discussion will be presented comparing the positive implications of technology transfers (positive spillovers, technological catching-up, growing complementarities with domestic firms) with negative implications (displacement of workers, negative welfare implications, competitive effects with domestic firms). Moreover the nature of transferred technologies together with the different institutional ‘absorptive capacities’ and sectoral specializations will be considered.

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