Horizontal and Vertical Technology Spillover of Foreign Direct Investment: An Evaluation across Indian Manufacturing Industries

Smruti Ranjan Behera Behera, Pami Dua and Bishwanath Goldar Goldar

MPRA Paper from University Library of Munich, Germany

Abstract: This paper explores the horizontal and vertical technology spillover effect of foreign direct investment (FDI) across Indian manufacturing industries. On the basis of Pedroni cointegration tests, we find that technology spillovers can be transmitted via all kinds of intermediate factors. We find that the horizontal foreign presence and inter-industry foreign presence have exclusive penetration effect to spur labor productivity and technology spillover across Indian industries. Furthermore, intermediate factors like technology import intensity, inter-industry technology import intensity, R&D intensity and inter-industry R&D intensity promote technology spillover and labor productivity across Indian manufacturing industries.

Keywords: Foreign Direct Investment; Technology Spillover; Manufacturing; Panel Cointegration; Unit Root Tests (search for similar items in EconPapers)
JEL-codes: C33 L60 P33 (search for similar items in EconPapers)
Date: 2012-10-01
New Economics Papers: this item is included in nep-cse
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