[01] Diana Loubaki, Department of Fundamental Analysis in Economics, University Marien N’Gouabi, Clamart, France.

This article presents a unified development theory provided by the intercept of the modern growth and the brain drain literatures to bring a modern view of development. We find that, knowledge is an increasing function according to modern growth and a decreasing function according to the brain drain, thereby, defines a threshold where development may take-off. After the cross of this locus, the economy yields multiple equilibria where development may rise or a poverty trap may settle. Finally, when development holds, it is the resulting effect of several mechanisms such as: the capacity to innovate through R&D, knowledge adoption and absorption in the production sector are engines of growth and development. Moreover, human capital increase substitutes diaspora over time and accelerates the speed of convergence of the development path to its frontier.

Technology Adoption, Technology Absorption, Knowledge Externalities, Diaspora

[01] Aghion, Philippe, and Peter Howitt. 1992. “A Model of Growth through Creative Destruction.” Econometrica 60 (2): 323–51. [02] Alvarez, Fernando, Francisco J. Buera, and Robert E. Lucas, Jr. 2014. “Idea Flows, Economic Growth, and Trade.” Unpublished. [03] Baldwin, Richard, Henrik Braconier, and Rikard Forslid. 2005. “Multinationals, Endogenous Growth, and Technological Spillovers: Theory and Evidence.” Review of International Economics 13 (5): 945–63. [04] Baldwin, Richard E., and Frédéric Robert-Nicoud. 2008. “Trade and Growth with Heterogeneous Firms.” Journal of International Economics 74 (1): 21–34. [05] Coe, David T., and Elhanan Helpman. 1995. “International R&D Spillovers.” European Economic Review 39 (5): 859–87. [06] Eaton, Jonathan, and Samuel Kortum. 1999. “International Technology Diffusion: Theory and Measurement.” International Economic Review 40 (3): 537–70. [07] Eaton, Jonathan, and Samuel Kortum. 2002. “Technology, Geography, and Trade.” Econometrica 70 (5): 1741–79. [08] Feenstra, Robert C. 1996. “Trade and Uneven Growth.” Journal of Development Economics 49 (1): 229–56. [09] Grossman, Gene M., and Elhanan Helpman. 1991a. Innovation and Growth in the Global Economy. Cambridge, MA: MIT Press. [10] Grossman, Gene M., and Elhanan Helpman. 1991b. “Trade, Knowledge Spillovers, and Growth.” European Economic Review 35 (2–3): 517–26. [11] Grossman, Gene M., and Elhanan Helpman. 2014. “Growth, Trade and Inequality.” National Bureau of Economic Research Working Paper 20502. [12] Grossman, Gene M., and Elhanan Helpman. 2015. “Globalization and Growth”, American Economic Review, 105(5): 100–104. [13] Helpman, Elhanan. 2004. The Mystery of Economic Growth. Cambridge, MA: Belknap by Harvard University Press. [14] Keller, Wolfgang. 2010. “International Trade, Foreign Direct Investment, and Technology Spillovers.” In Handbook of the Economics of Innovation. Vol. 2, edited by Bronwyn H. Hall and Nathan Rosenberg, 793–829. Amsterdam: Elsevier B.V. [15] Lucas, Robert E., Jr. 1988. “On the Mechanics of Economic Development.” Journal of Monetary Economics 22 (1): 3–42. [16] Melitz, Marc J. 2003. “The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity.” Econometrica 71 (6): 1695–1725. [17] Peretto, Pietro F., and Simone Valente. 2011. “Resources, Innovation and Growth in the Global Economy.” Journal of Monetary Economics 58 (4): 387–99. [18] Perla, Jesse, Christopher Tonetti, and Michael E. Waugh. 2014. “Equilibrium Technology Diffusion, Trade, and Growth.” Unpublished. [19] Romer, Paul M. 1990. “Endogenous Technical Change.” Journal of Political Economy 98 (5, Part 2): S71–S102. [20] Sampson, Thomas. 2014. “Dynamic Selection: An Idea Flows Theory of Entry, Trade and Growth.” Unpublished. [21] Young, Alwyn. 1991. “Learning by Doing and the Dynamic Effects of International Trade.” Quarterly Journal of Economics 106 (2): 369–405.