Foreign know-how, firm control, and the income of developing countries:

Managerial know-how shapes the productivity of firms by defining the set of available technologies, production choices, and market opportunities. This know-how can be reallocated across countries as managers acquire control of factors of production abroad. In this paper, we construct a quantitative...

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Bibliographic Details
Main Authors: Burstein, Ariel T. 1974- (Author), Monge-Naranjo, Alexander (Author)
Format: Book
Language:English
Published: Cambridge, Mass. National Bureau of Economic Research 2007
Series:Working paper series / National Bureau of Economic Research 13073
Online Access:Volltext
Summary:Managerial know-how shapes the productivity of firms by defining the set of available technologies, production choices, and market opportunities. This know-how can be reallocated across countries as managers acquire control of factors of production abroad. In this paper, we construct a quantitative model of cross-country income differences to study the aggregate consequences of international mobility of managerial know-how. We use the model and aggregate data to infer the relative scarcity of this form of know-how for a sample of developing countries. We also conduct policy counterfactuals and find that on average, developing countries gain up to 23% in output and 9% in consumption when they eliminate all barriers to foreign control of domestic factors of production.
Physical Description:41, [9] S. graph. Darst. 22 cm

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