Technology Gap, Competition and Spillovers from Direct Foreign Investment: Evidence from Establishment Data
AbstractUsing detailed micro data from the Indonesian manufacturing sector, we examine the effect on productivity of direct foreign investment. The results suggest that direct foreign investment benefits locally owned establishments. The effect differs between groups of industries. Spillovers from DFI are found in sectors with a high degree of competition. The result suggests that the degree of competition affects the choice of technology transferred to the multinationals' affiliates and, hence, the potential for spillovers. Moreover, it seems to be domestic competition rather than competition from imports that affects spillovers from DFI. Our result concerning the effect from technology gap is unclear.
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Bibliographic InfoPaper provided by Stockholm School of Economics in its series Working Paper Series in Economics and Finance with number 212.
Length: 26 pages
Date of creation: 11 Dec 1997
Date of revision:
Publication status: Forthcoming in Journal of Development Studies.
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Direct foreign investment; spillovers; technology; competition;
Other versions of this item:
- Fredrik Sjoholm, 1999. "Technology gap, competition and spillovers from direct foreign investment: Evidence from establishment data," Journal of Development Studies, Taylor & Francis Journals, vol. 36(1), pages 53-73.
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- O30 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - General
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