the region and investigates its implications for welfare. It estimates the potential gains in terms of income growth and poverty reduction, inherent to hypothetical advances in technology from pseudopanel models. A control experiment allows a simulation of the potential growth effects of improved scientific infrastructures and models the hypothetical losses illustrated by lower GDP growth rates. Under this experiment and assuming all other things equal, empirical results reveal significantly high costs of technology trap for growth and welfare in the region. In particular, it is shown that if African countries were operating on the global technology frontier enjoyed by OECD countries, their income level would be significantly higher, over four times the current estimates ceteris paribus.<sup>7</sup> These results are robust, even after controlling for institutional and macroeconomic instability. They corroborate the positive science-development link, and are consistent with findings from principal component analysis. In addition, the model is calibrated to estimate the long-term effects of sustained technologically-driven growth on poverty in Ethiopia. The results highlight a uniform decline of poverty rates under an hypothetical increased applications and use of technology. In particular, sustained increase in research and development results in a significant reduction of the headcount index.

The next section provides an historical overview of technology and development link and establishes the existence of a technology trap in SSA. Section III discusses low-technology-based poverty trap models and empirically tests the existence of a technology trap in the region using the principal components analysis. Section IV proposes a model for estimating the welfare effects of advances in science and technology. Section V discusses the empirical results and the last section concludes.

# **II. Global technology-led growth and Africa’s low-technology trap**

The implications of technological progress and scientific innovations for welfare go back as far as the pre-industrialization era when scientific inventions and tool-making technologies were used in the field of medicine, agriculture and metallurgy within a very constricted organizational framework. Initially, the link between technology and human development is primarily motivated by short-term benefits and particularly population well-being. Efficiency gains and considerations and direct impact on income growth and wealth accumulation, possibly emanating from economies of scale and productivity growth, is relatively limited, owing largely to the preeminence of subsistence economies characterized by low capital-labor ratio and missing or segmented markets [Maddison (1995)].

However, with advances in science and technology and engineering applications, particularly following the industrial revolution, specialization and growing demands, the link between technology and economic development grew stronger. Over time, it became more evident through a selfreinforcing process of knowledge accumulation in a virtuous circle of sustained growth fuelled by consumption booms. These advances were made possible by technological innovations and scientific prowess which contributed to the development of infrastructure, transportation, communication and manufacturing, all key for productivity growth and industrial output expansion [Smiles (1966), Mansfield (1980)].<sup>8</sup> 7 Though variable over time, the global technology frontier is space invariant as it obeys the principle of unicity; however, it is product-driven. For instance, Taiwan closed its gap with the world technology frontier in the manufacturing of semiconductors in the late 1990s [Mathews and Hu (2007)]. Evidently, there are certainly numerous areas of production where it is still operating inside the frontier, nonetheless.

> 8 In a book published in 1888 and titled _the live of engineers_ , Samuel Smile attributed the reduction of income and welfare gaps between Britain and its neighboring European rivals to the success of British engineers and scientists, who endowed Britain with the most modern infrastructures in Europe.

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