Skip to main content

CEP/STICERD Applications Seminars

Big Push in Distorted Economies

Hugo Hopenhayn (University of California, Los Angeles), joint with Francisco J. Buera, Yongseok Shin and Nicholas Trachter

Monday 25 March 2024 12:00 - 13:30

Many of our seminars and public events this year will continue as in person or as hybrid (online and in person) events. Please check our website listings and Twitter feed @STICERD_LSE for updates.

Unless otherwise specified, in-person seminars are open to the public. Please ensure you have informed the event contact as early as possible.

Those unable to join the seminars in-person are welcome to participate via zoom if the event is hybrid.


About this event

Why don't poor countries adopt more productive technologies? Is there a role for policies that coordinate technology adoption? To answer these questions, we develop a quantitative model that features complementarity in firms' technology adoption decisions: The gains from adoption are larger when more firms adopt. When this complementarity is strong, multiple equilibria and hence coordination failures are possible. More important, even without equilibrium multiplicity, the model elements responsible for the complementarity can substantially amplify the effect of distortions and policies. In what we call the Big Push region, the impact of idiosyncratic distortions is over three times larger than in models without such complementarity. This amplification enables our model to nearly fully account for the income gap between India and the US without coordination failures playing a role.

Applications (Applied Micro) Seminars are held on Mondays in term time at 12:00-13:30 in SAL 3.05 in person.

Seminar organiser: Katie Smith

For further information please contact Sadia Ali: s.ali43@lse.ac.uk.

Please use this link to subscribe or unsubscribe to our mailing list (applications).