Using a unique microaggregated data set on firm-level productivity in 13 countries from 1995 to 2014, this article provides new evidence on technology- and knowledge-diffusion barriers for laggard firms. We show that, although the least productive firms benefit from a catch-up effect, their speed of catchup is lower in digital- and skill-intensive industries. This is especially true in countries with high skill mismatch, high financing frictions, and low absorptive capacity. These barriers to diffusion, combined with the rising importance of tacit knowledge and intangibles, could help explain the productivity growth slowdown observed in the last decades.

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19 November 2024

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International Economic Review 2024

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DOI: 10.1111/iere.12748

https://onlinelibrary.wiley.com/doi/10.1111/iere.12748

This Journal article is published under the centre's Trade programme, Growth programme.