Catching-up in a globalised context: Technological change as a driver of growth

Bart Verspagen & Mary Kaltenberg


This paper aims to understand the role that technology plays, particularly in structural change, as a driver of economic growth. Noting the exceptional few countries that succeeded in becoming a developed state and the accelerated period of globalisation (1995 - 2009), we analyse growth patterns at the product, sectoral and macroeconomic levels. Utilising trade data, we detail the type of complex products exported as a reflection of a nation's latent capabilities. At the sectoral level, technological shifts are observed through a TFP analysis to understand how countries use technological progress at varying development stages to realise economic growth. Finally, we use input-output analysis for a macroeconomic perspective on the impact of globalisation on production by sector and on demand patterns of foreign and domestic markets, both globally and regionally.

JEL Classification: F620, O300,O470

Key words: Technological Change, Development and Economic Growth, Structural change, International Trade, Convergence