Assessing the Effects of Trade-induced Technology Imitation on Economic Growth in Africa

The study aims at quantifying the effects of trade-induced technology imitation (proxied by the share of imports in the “easy imitation” SITC category) on economic growth in Africa, using a production function approach in a panel system-GMM estimator. Indicators of trade-induced technology imitation have been built on the Standard International Trade Classification (SITC) using raw data from the United Nations’ COMTRADE Statistics. Findings suggest that economic growth tends to be greater in countries with higher ratios of technology imitation, since technology imitation requires creative effort on the part of a firm's employees and will consequently develop capabilities such as skills and efficiency. Another finding is that the lower the level of GDP per capita, the higher the growth effects of technology imitation relative to other forms of technology progress.