Industrial Policy and Technology Diffusion in Developing Countries: Paper Making Machinery in Indonesia, 1923-2000

M. van Dijk, A. Szirmai

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Abstract

In this paper, we analyze the diffusion and adoption of paper making machinery in the indonesian pulp and paper industry, from 1923 till 2000. We develop a machine level index of technological sophistication (mach), which measures the technological distance of each paper machine to the world technological frontier. The data reveal a pattern of rapid technological catch up. But catch up was not an industrywide phenomenon. Some modern firms installed state-of-the-art machinery, while others installed older vintages. The paper argues that industrial policy has played an important role in the speed and nature of diffusion of paper making machinery.
Original languageEnglish
Pages (from-to)2137-2152
JournalWorld Development
Volume34
Issue number12
DOIs
Publication statusPublished - Dec 2006

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