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

Ganeshan Wignaraja

No 2008-061, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (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.

Keywords: foreign direct investment; innovation; technological capabilities; R&D; firm-level exports; electronics; East Asia; China; Thailand and the Philippines (search for similar items in EconPapers)
JEL-codes: F23 L63 O31 O32 O57 (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:unm:unumer:2008061

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