IDEAS home Printed from https://ideas.repec.org/p/ind/cdswpp/385.html
   My bibliography  Save this paper

International trade, R & D spillovers and productivity: Evidence from Indian manufacturing industry

Author

Listed:
  • M. Parameswaran

    (Centre for Development Studies
    Institute of Economic Growth)

Abstract

This paper examines the effect of trade facilitated R & D spillovers on the productivity of manufacturing firms in India. Though developing countries are considered as the major beneficiaries of trade facilitated R&D spillovers, detailed empirical investigations in their context are lacking. The paper distinguishes R&D spillovers into two types and examines their effect on productivity. It also considers the intersectoral variation in productivity effect and the importance of firms' investment in R&D, imported technology and plant and machinery in enhancing the effect on productivity. The paper uses firm level panel data and an improved estimation method. It shows that R&D spillovers have a significant effect on productivity and there exists intersectoral variation with greater contribution to productivity in technology intensive industries. The paper also shows that firms' investment in R&D and plant and machinery are enhancing the productivity effect of R&D spillovers.

Suggested Citation

  • M. Parameswaran, 2007. "International trade, R & D spillovers and productivity: Evidence from Indian manufacturing industry," Centre for Development Studies, Trivendrum Working Papers 385, Centre for Development Studies, Trivendrum, India.
    • Handle: RePEc:ind:cdswpp:385
    as

    Download full text from publisher

    File URL: http://www.cds.edu/wp-content/uploads/2012/09/wp385.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bin Xu & Jianmao Wang, 1999. "Capital Goods Trade and R&D Spillovers in the OECD," Canadian Journal of Economics, Canadian Economics Association, vol. 32(5), pages 1258-1274, November.
    2. Keller, Wolfgang, 2000. "Do Trade Patterns and Technology Flows Affect Productivity Growth?," The World Bank Economic Review, World Bank, vol. 14(1), pages 17-47, January.
    3. Berndt, Ernst R. & Morrison, Catherine J., 1995. "High-tech capital formation and economic performance in U.S. manufacturing industries An exploratory analysis," Journal of Econometrics, Elsevier, vol. 65(1), pages 9-43, January.
    4. Romer, Paul, 1994. "New goods, old theory, and the welfare costs of trade restrictions," Journal of Development Economics, Elsevier, vol. 43(1), pages 5-38, February.
    5. Deolalikar, Anil B & Evenson, Robert E, 1989. "Technology Production and Technology Purchase in Indian Industry: An Econometric Analysis," The Review of Economics and Statistics, MIT Press, vol. 71(4), pages 689-692, November.
    6. Dibyendu S. Maiti, 2005. "Organisational morphology of rural industries in liberalised India: A study of West Bengal," Centre for Development Studies, Trivendrum Working Papers 371, Centre for Development Studies, Trivendrum, India.
    7. Sunil Mani, 2007. "Keeping Pace with Globalisation: Innovation Capability in Korea’s Telecommunications Equipment Industry," Springer Books, in: Jörg C. Mahlich & Werner Pascha (ed.), Innovation and Technology in Korea, pages 255-286, Springer.
    8. Heston, Alan, 1994. "A brief review of some problems in using national accounts data in level of output comparisons and growth studies," Journal of Development Economics, Elsevier, vol. 44(1), pages 29-52, June.
    9. Basant, Rakesh & Fikkert, Brian, 1996. "The Effects of R&D, Foreign Technology Purchase, and Domestic and International Spillovers on Productivity in Indian Firms," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 187-199, May.
    10. Egan, Mary Lou & Mody, Ashoka, 1992. "Buyer-seller links in export development," World Development, Elsevier, vol. 20(3), pages 321-334, March.
    11. Zvi Griliches, 1998. "Issues in Assessing the Contribution of Research and Development to Productivity Growth," NBER Chapters, in: R&D and Productivity: The Econometric Evidence, pages 17-45, National Bureau of Economic Research, Inc.
    12. Lee, Jong-Wha, 1995. "Capital goods imports and long-run growth," Journal of Development Economics, Elsevier, vol. 48(1), pages 91-110, October.
    13. H. Schmitz & P. Knorringa, 2000. "Learning from Global Buyers," Journal of Development Studies, Taylor & Francis Journals, vol. 37(2), pages 177-205.
    14. Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-596, September.
    15. N. Vijayamohanan Pillai, 2004. "CES function, generalised mean and human poverty index: Exploring some links," Centre for Development Studies, Trivendrum Working Papers 360, Centre for Development Studies, Trivendrum, India.
    16. Zvi Griliches, 1998. "PRACTIcING ECONOMETRICS," Books, Edward Elgar Publishing, number 192.
    17. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
    18. Nicita, Alessandro & Olarreaga, Marcelo, 2001. "Trade and production, 1976-99," Policy Research Working Paper Series 2701, The World Bank.
    19. Zachariah KC, 2007. "Economic and Social Dynamics of Migration in Kerala, 1999-2004 Analysis of Panel Data," Working Papers id:1087, eSocialSciences.
    20. Vineetha Menon & Antonyto Paul & K.N. Nair, 2005. "Dynamics of irrigation institutions: Case study of village panchayat in Kerala," Centre for Development Studies, Trivendrum Working Papers 367, Centre for Development Studies, Trivendrum, India.
    21. Ferrantino, Michael J, 1992. "Technology Expenditures, Factor Intensity, and Efficiency in Indian Manufacturing," The Review of Economics and Statistics, MIT Press, vol. 74(4), pages 689-700, November.
    22. L. K. Raut, 1988. "R & D Behaviour of Indian Firms: A Stochastic Control Model," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 23(2), pages 207-229, July.
    23. Connolly, Michelle, 2003. "The dual nature of trade: measuring its impact on imitation and growth," Journal of Development Economics, Elsevier, vol. 72(1), pages 31-55, October.
    24. Hasan, Rana, 2002. "The impact of imported and domestic technologies on the productivity of firms: panel data evidence from Indian manufacturing firms," Journal of Development Economics, Elsevier, vol. 69(1), pages 23-49, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Das, Amarendra, 2012. "Who extracts minerals more efficiently—Public or private firms? A study of Indian mining industry," Journal of Policy Modeling, Elsevier, vol. 34(5), pages 755-766.
    2. K.J Joseph & Vinoj Abraham, 2007. "Information technology and productivity: Evidence from India's manufacturing sector," Centre for Development Studies, Trivendrum Working Papers 389, Centre for Development Studies, Trivendrum, India.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Asmita Goswami & K. Narayanan, 2022. "Technological Efforts, Firm Ownership and Productivity: A Study of Information Technology Service Firms in India," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 23(1), pages 86-109, March.
    2. Hasan, Rana, 2002. "The impact of imported and domestic technologies on the productivity of firms: panel data evidence from Indian manufacturing firms," Journal of Development Economics, Elsevier, vol. 69(1), pages 23-49, October.
    3. Rana Hasan, 2000. "The Impact of Imported and Domestic Technologies on Productivity: Evidence from Indian Manufacturing Firms," Economics Study Area Working Papers 06, East-West Center, Economics Study Area.
    4. K.J Joseph & Vinoj Abraham, 2007. "Information technology and productivity: Evidence from India's manufacturing sector," Centre for Development Studies, Trivendrum Working Papers 389, Centre for Development Studies, Trivendrum, India.
    5. Chandan Sharma, 2016. "R&D, Technology Transfer And Productivity In The Indian Pharmaceutical Industry," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(01), pages 1-24, January.
    6. Raut, Lakshmi K., 1995. "R & D spillover and productivity growth: Evidence from Indian private firms," Journal of Development Economics, Elsevier, vol. 48(1), pages 1-23, October.
    7. Sharma, Chandan, 2018. "Exporting, access of foreign technology, and firms’ performance: Searching the link in Indian manufacturing," The Quarterly Review of Economics and Finance, Elsevier, vol. 68(C), pages 46-62.
    8. Vishwasrao, Sharmila & Bosshardt, William, 2001. "Foreign ownership and technology adoption: evidence from Indian firms," Journal of Development Economics, Elsevier, vol. 65(2), pages 367-387, August.
    9. Blalock, Garrick & Veloso, Francisco M., 2007. "Imports, Productivity Growth, and Supply Chain Learning," World Development, Elsevier, vol. 35(7), pages 1134-1151, July.
    10. Hrushikesh Mallick, 2007. "Does Energy Consumption Fuel Economic Growth In India?," Working Papers id:1299, eSocialSciences.
    11. KC.Zachariah & S.Irudaya Rajan, 2007. "Economic and social dynamics of migration in Kerala, 1999-2004: Analysis of panel data," Centre for Development Studies, Trivendrum Working Papers 384, Centre for Development Studies, Trivendrum, India.
    12. Gong, Guan & Keller, Wolfgang, 2003. "Convergence and polarization in global income levels: a review of recent results on the role of international technology diffusion," Research Policy, Elsevier, vol. 32(6), pages 1055-1079, June.
    13. Lopamudra D. Satpathy & Bani Chatterjee & Jitendra Mahakud, 2017. "Firm Characteristics and Total Factor Productivity: Evidence from Indian Manufacturing Firms," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 11(1), pages 77-98, February.
    14. D. Shyjan, 2007. "Public investment and agricultural productivity: A State-wise analysis of foodgrains in India," Centre for Development Studies, Trivendrum Working Papers 387, Centre for Development Studies, Trivendrum, India.
    15. Neil Foster-McGregor, 2012. "Innovation and Technology Transfer across Countries," wiiw Research Reports 380, The Vienna Institute for International Economic Studies, wiiw.
    16. K.J. Joseph & Govinda Parayil, 2006. "Trade liberalization and digital divide: An Analysis of the information technology agreement of WTO," Centre for Development Studies, Trivendrum Working Papers 381, Centre for Development Studies, Trivendrum, India.
    17. Sunil Mani, 2007. "The Growth performance of India's telecommunication serivices industry, 1991-2006: Can it lead to the emergence of a domestic manufacturing hub?," Centre for Development Studies, Trivendrum Working Papers 390, Centre for Development Studies, Trivendrum, India.
    18. R. Rijesh, 2015. "Technology Import and Manufacturing Productivity in India: Firm Level Analysis," Journal of Industry, Competition and Trade, Springer, vol. 15(4), pages 411-434, December.
    19. Wolfgang Keller, 2004. "International Technology Diffusion," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 752-782, September.
    20. Czarnitzki, Dirk & Thorwarth, Susanne, 2012. "Productivity effects of basic research in low-tech and high-tech industries," Research Policy, Elsevier, vol. 41(9), pages 1555-1564.

    More about this item

    Keywords

    R&D Spillover; trade; manufacturing industry; productivity;
    All these keywords.

    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ind:cdswpp:385. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Shamprasad M. Pujar (email available below). General contact details of provider: https://edirc.repec.org/data/cdsacin.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.