More evidence on technological catching-up in the manufacturing sector

Abstract

Production frontiers for the manufacturing sector are estimated to determine a “country specific” catching-up process of Total Factor Productivity (TFP).TFP gains are gauged at the manufacturing industry level for 14 OECD countries over the 1970-2001 period. Our TFP measure does not assume technical or allocative efficiency which are inherent drawbacks of usual TFP indices. We show that catching-up processes can be very different between sub-periods and across countries. A significant catching-up process was at work in the manufacturing sector between 1970 and 1986 then it overturned over the period 1987-2001. During the first sub-period, the speed of technological catching-up of the euro-zone countries is definitely higher than those of the other European or OECD nations whereas the divergence noted in second sub-period has the same order of magnitude among the three groups.Catching-up; TFP change index; Technology adoption; Production Frontier