Technology innovation is a significant resource in the contemporary knowledge-based economy. The main sources of technology innovation are internal R&D effort and external imported technology. Two primary traditional production factors are physical capital and labour. The theoretical basis for this study is an evolutionary Cobb-Douglas production function explaining the effects of four resources (internal R&D effort, imported technology, physical capital and labour) on a firm's sales and economic value added (EVA). Time-series cross-section panel data from 219 Taiwan electronic manufacturers between 1990 and 2003 were employed for fixed effect model. Major empirical findings were observed in this study: first, Internal R&D effort can positively affect a firm's sales and EVA. Conversely, imported technology is found to have had no significant effect on sales and EVA. Second, although both physical capital and labour affect a firm's sales more than the effects of internal R&D and external imported technology, internal R&D effort contributes to a firm's EVA beyond the effects of imported technology, physical capital and labour. Third, External imported technology has neither a complementary nor a substitutive relationship with internal R&D effort.
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Article provided by Taylor and Francis Journals in its journal Applied Economics.
Volume (Year): 40 (2008) Issue (Month): 8 () Pages: 1073-1082 Download reference. The following formats are available: HTML,
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