North-South Technology Diffusion: How Important Are Trade, FDI and International Telecommunications?
AbstractThere is an influential literature studying the impact on total factor productivity (TFP) of foreign technology obtained through imports (trade). This paper builds on that literature and is a first attempt to examine the effects on TFP in the South of technology developed in the North that is diffused not only through international trade, but also through foreign direct investment (FDI) and international telecommunications (ITC) measured in call traffic. For developing countries in the South, we construct trade-related, FDI-related and ITC-related North foreign R&D indices, using country specific R&D stocks in the North, and respectively with North-South bilateral trade patterns, FDI patterns and ITC volumes. We find: (i) trade and ITC both significantly promote North-South technology diffusion, while FDI seems to generate North-South technology diffusion, though not always significantly; (ii) the effects on TFP through ITC-related foreign R&D are the largest, followed in order by those through trade-related, and then by those through FDI-related foreign R&D indices; and (iii) the effects on TFP of traderelated North foreign R&D are primarily driven by the growth in developing countries’ trade-to-GDP ratios, while the effects from ITC-related North foreign R&D are largely due to the growth in the Northern R&D stocks.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Carleton University, Department of Economics in its series Carleton Economic Papers with number 06-01.
Length: 31 pages
Date of creation: 15 Mar 2006
Date of revision:
Publication status: Published: Carleton Economic Papers
Contact details of provider:
Postal: 1125 Colonel By Drive, Ottawa Ontario, K1S 5B6 Canada
Find related papers by JEL classification:
- F1 - International Economics - - Trade
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-03-31 (All new papers)
- NEP-INO-2007-03-31 (Innovation)
- NEP-INT-2007-03-31 (International Trade)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Borensztein, E. & De Gregorio, J. & Lee, J-W., 1998.
"How does foreign direct investment affect economic growth?1,"
Journal of International Economics, Elsevier,
Elsevier, vol. 45(1), pages 115-135, June.
- Eduardo Borensztein & Jose De Gregorio & Jong-Wha Lee, 1995. "How Does Foreign Direct Investment Affect Economic Growth?," NBER Working Papers 5057, National Bureau of Economic Research, Inc.
- Maurice Schiff & Yanling Wang, 2003. "Nafta, Technology Diffusion and Productivity in Mexico," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 40(121), pages 469-476.
- Keller, Wolfgang, 2002.
" Trade and the Transmission of Technology,"
Journal of Economic Growth, Springer,
Springer, vol. 7(1), pages 5-24, March.
- Wolfgang Keller, 1996. "Trade and the Transmission of Technology," Development and Comp Systems 9609001, EconWPA.
- Wolfgang Keller, 1997. "Trade and the Transmission of Technology," Development and Comp Systems 9707001, EconWPA.
- Keller, W., 1997. "Trade and the Transmission of Technology," Working papers, Wisconsin Madison - Social Systems 9620r, Wisconsin Madison - Social Systems.
- Falvey, Rod & Foster, Neil & Greenaway, David, 2007. "Relative backwardness, absorptive capacity and knowledge spillovers," Economics Letters, Elsevier, Elsevier, vol. 97(3), pages 230-234, December.
- Ann E. Harrison & Brian J. Aitken, 1999. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," American Economic Review, American Economic Association, American Economic Association, vol. 89(3), pages 605-618, June.
- Abramovitz, Moses, 1986. "Catching Up, Forging Ahead, and Falling Behind," The Journal of Economic History, Cambridge University Press, Cambridge University Press, vol. 46(02), pages 385-406, June.
- Smarzynska, Beata K., 2002.
"Does foreign direct investment increase the productivity of domestic firms : in search of spillovers through backward linkages,"
Policy Research Working Paper Series
2923, The World Bank.
- Beata Smarzynska Javorcik, 2004. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages," American Economic Review, American Economic Association, American Economic Association, vol. 94(3), pages 605-627, June.
- Beata K. Smarzynska, 2003. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers through Backward Linkages," William Davidson Institute Working Papers Series 548, William Davidson Institute at the University of Michigan.
- Dollar, David & Kraay, Aart, 2003. "Institutions, trade, and growth," Journal of Monetary Economics, Elsevier, Elsevier, vol. 50(1), pages 133-162, January.
- Wolfgang Keller, 1999.
"How Trade Patterns and Technology Flows Affect Productivity Growth,"
NBER Working Papers
6990, National Bureau of Economic Research, Inc.
- Keller, Wolfgang, 2000. "Do Trade Patterns and Technology Flows Affect Productivity Growth?," World Bank Economic Review, World Bank Group, World Bank Group, vol. 14(1), pages 17-47, January.
- Keller, Wolfgang, 1997. "How trade patterns and technology flows affect productivity growth," Policy Research Working Paper Series 1831, The World Bank.
- Papageorgiou, Chris & Savvides, Andreas & Zachariadis, Marios, 2007.
"International medical technology diffusion,"
Journal of International Economics, Elsevier,
Elsevier, vol. 72(2), pages 409-427, July.
- Chris Papageorgiou & Andreas Savvides & Marios Zachariadis, 2005. "International Medical Technology Diffusion," University of Cyprus Working Papers in Economics, University of Cyprus Department of Economics 2-2005, University of Cyprus Department of Economics.
- Chris Papageorgiou & Andreas Savvides & Marios Zachariadis, 2006. "International Medical Technology Diffsion," 2006 Meeting Papers, Society for Economic Dynamics 23, Society for Economic Dynamics.
- Haddad, Mona & Harrison, Ann, 1993. "Are there positive spillovers from direct foreign investment? : Evidence from panel data for Morocco," Journal of Development Economics, Elsevier, Elsevier, vol. 42(1), pages 51-74, October.
- Noguer, Marta & Siscart, Marc, 2005. "Trade raises income: a precise and robust result," Journal of International Economics, Elsevier, Elsevier, vol. 65(2), pages 447-460, March.
- Andreas Savvides & Marios Zachariadis, 2005. "International Technology Diffusion and the Growth of TFP in the Manufacturing Sector of Developing Economies," Review of Development Economics, Wiley Blackwell, Wiley Blackwell, vol. 9(4), pages 482-501, November.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Renee Lortie).
If references are entirely missing, you can add them using this form.