Catch-up growth

posted by
March 6, 2011
The American Prospect
by Matthew Yglesias  
Posted in Commentary, PND Commentary

"To oversimplify a bit, you can think of the world as featuring two paths of economic growth. One is frontier-pushing growth, where high-tech countries dream up new ideas -- someone invents Facebook, or a better industrial robot, or a faster train. Another is catch-up growth in which a poor country prospers by copying ideas that have already been developed in countries closer to the frontier. That's what happens when an apparel factory opens up in Bangladesh or a Mexican bank branch starts using ATMs. Of course in the real world, all countries are doing a bit of both all the time. Rich countries copy each others' inventions and poor countries come up with some new ideas. But it works as a rough and ready distinction." (03/04/11)  

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