FDI and Innovation as Drivers of Export Behaviour: Firm-level Evidence from East Asia

Wignaraja, Ganeshan (2008). FDI and Innovation as Drivers of Export Behaviour: Firm-level Evidence from East Asia. UNU-MERIT.

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  • Author Wignaraja, Ganeshan
    Title FDI and Innovation as Drivers of Export Behaviour: Firm-level Evidence from East Asia
    Publication Date 2008
    Publisher UNU-MERIT
    Abstract This paper examines the links between ownership, innovation and exporting in electronics firms in three late industrializing East Asian countries (China, Thailand and the Philippines) drawing on recent developments in applied international trade and innovation and learning. Technology-based approaches to trade offer a plausible explanation for firm-level exporting behavior. The econometric results (using probit) confirm the importance of foreign ownership and innovation in increasing the probability of exporting in electronics. Higher levels of skills, managers’ education and capital also matter in China as well as accumulated experience in Thailand. Furthermore, a technology index composed of technical functions performed by firms emerges as a more robust indicator of innovation than the R&D to sales ratio. Accordingly, technological effort in electronics in these countries mostly focuses on assimilating and using imported technologies rather than formal R&D by specialized engineers.
    Keyword Foreign direct investment
    Innovation
    Technological capabilities
    R&D
    Firm-level exports
    Electronics
    East Asia
    China
    Thailand and the Philippines
    JEL F23
    O31
    O32
    L63
    O57
    Copyright Holder UNU-MERIT
    Copyright Year 2008
    ISSN 1871-9872
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    Created: Wed, 11 Dec 2013, 16:23:35 JST