Financial development and technology diffusion
By: Diego Comin, Ramana Nanda
Contributors: Nanda, Ramana, author; Harvard Business School
Series: Working paper / Harvard Business School -- 15-036; Working paper (Harvard Business School) -- 15-036
Publisher: Harvard Business School
Published: 2014
Place of publication: Boston]
Language: eng
Number of pages: 21
Description: We examine the extent to which financial market development impacts the diffusion of 16 major technologies, looking across 55 countries, from 1870 to 2000. We find that greater depth in financial markets leads to faster technology diffusion for more capital-intensive technologies, but only in periods closer to the invention of the technology. In fact, we find no differential effect of financial depth on the diffusion of capital-intensive technologies in the late stages of diffusion or in late adopters. Our results are consistent with a view that local financial markets play a critical role in facilitating the process of experimentation that is required for the initial commercialization of technologies. This evidence also points to an important mechanism relating financial market development to technology diffusion and economic growth.
Notes: "November 2014" -- Publisher's website.

Includes bibliographical references (pages 18-21).