Technology transfer and convergence of performance: an economic study of FIFA football ranking

Abstract

The seminal work of Gerschenkron (1962) stated that latecomers borrow advanced technology from their predecessors, resulting in convergence of productivity among nations. Additionally, the diffusion of technology among developing nations has been fulfilled not only directly from developed nations but also from surrounding nations through local spillovers such as learning from others. Recently, the disparity in national football performance among the nations appears to have improved, and it is evident that talented players are mobilized from developing nations to developed ones. The present article attempts to apply the framework of development economics, as introduced earlier, to the case of international football. An empirical examination of FIFA's world ranking points considered as reflecting nations' performances was conducted, applying panel data to control for unobserved nations' specific effects (Baltagi 2005). The results indicate that both technology transfer and the local information spillover play a crucial role in improving the performance of developing nations, but not of developed nations. The presented results are interpreted as implying that developing nations are able to catch up with developed ones due to the effects of technology transfer and local information spillover.