Globalization and Innovation in Emerging Markets

Yuriy Gorodnichenko, Jan Svejnar and Katherine Terrell

American Economic Journal: Macroeconomics, 2010, vol. 2, issue 2, 194-226

Abstract: Globalization brings opportunities and pressures for domestic firms in emerging markets to innovate and improve their competitive position. Using data from 27 emerging market economies, we estimate the effects of foreign competition and linkages with foreign firms on innovation by domestic firms. We provide robust evidence of a positive relationship between foreign competition and innovation, broadly defined. The supply chain of multinational enterprises and trade are also important channels. There is no evidence for an inverted U relationship between innovation and foreign competition. Moreover, the relationship between globalization and innovation does not differ across the manufacturing and service sectors. (JEL F02, F23, M16, O33)

JEL-codes: F02 F23 M16 O33 (search for similar items in EconPapers)
Date: 2010
Note: DOI: 10.1257/mac.2.2.194
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Citations: View citations in EconPapers (153)

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Related works:
Working Paper: Globalization and innovation in emerging markets (2009)
Working Paper: Globalization and Innovation in Emerging Markets (2008)
Working Paper: Globalization and Innovation in Emerging Markets (2008)
Working Paper: Globalization and innovation in emerging markets (2008)
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