Three essays on neo-technology trade

Although there have been a variety of technology-pooling arrangements, due, in part, to the rising costs of research and development and to a need for a vast market place, existing North-South trade models emphasize only one-way technology transfer; there is no formal model of cross-technology trade. ESSAY #1 provides a formal model of cross-technology trade in a static setting. The model shows that (1) cross-technology trading equilibrium has a larger per-capita real income than that of technology autarky between similar economies with increasing returns to scale; (2) scale parameter affects the intensity of cross-technology trade; and (3) there exists a different paradigm between the cross-technology trade model and the North-South technology transfer model. ESSAY #2 combines the effect of economies of scale and monopolistic competition in inventions and the international division of different skills in three types of models of cross-technology trade, and it examines the implications on factor rewards and on patterns of trade in technologies. The models show that international economics of scale via cross-technology trade become a source for everyone in the world to gain. Since the equilibrium production and factoral terms of trade are interrelated with each other in respective model, the trade patterns are determined by direct computation of solution values in the trading equilibrium instead of using autarkic prices. In addition, terms of technology trade (TOTT) are sensitive to the fashion of factor market segmentation. Thus, in the context of cross-technology trade and increasing returns to scale, the argument on terms of trade depends upon three major indicators: (1) the relative factor abundance, (2) the aggregate scale effect, and (3) the fashion of factor market segmentation. While, surprisingly, in discussion of technology trade little attention has been focused on the behavior of the technology-importer, ESSAY #3 shows that there can exist different sets of decision criteria for a Schumpeterian entrepreneur who imports foreign technology under uncertainty. A Schumpeterian entrepreneur has four sets of decision criteria: (1) the existence of potential bound for the effective gross output net of royalties; (2) the shape of randomness-indifference locus; (3) the evaluation of the magnitude of boundedness in the effective gross output net of royalties; (4) the market interest rate