Learning sequences and structural diversification in developing countries

The article explains structural diversification through the interrelationship between learning by doing and the introduction of new technology. Structural diversification is constrained when learning-by-doing benefits do not spill over across national borders and when the fixed-cost expenditure associated with the introduction of new technology is high. Structural diversification is seen as being the result of dynamic learning sequences where introducing new technology provides learning-by-doing benefits which, however, peter out. once activities associated with the new technology have been repeated many times; new and more sophisticated technology is needed to continue reaping learning effects.