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An Application of Post-DEA Bootstrap Regression Analysis to the Spillover of the Technology of Foreign-Invested Enterprises in China

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  • Hirschberg, J.G.
  • Lloyd, P.J.

Abstract

It is now widely believed that Foreign Direct Investment (FDI) affects positively the productivity of individual enterprises in the host economy and this is a main argument in favour of FDI. Although China is the largest recipient of FDI after the USA, there has been little empirical research as to whether such productivity effects of FDI are present in China. In this paper we attempt to answer some of these questions using a data set constructed from the Third Industrial Census of China conducted in 1995. We employ a Data Envelopment Analysis (DEA) to estimate individual enterprise level relative productivity scores from an industry level nonparameteric production technology. These individual results are then related to the level of FDI via a Bootstrap regression which is used to insure consistent estimates of the variance covariance matrix of the regression estimates. The results are decomposed by size of enterprise and industry and provide an insight to the manner in which such spillover effects may be operating in the Chinese Economy.

Suggested Citation

  • Hirschberg, J.G. & Lloyd, P.J., 2000. "An Application of Post-DEA Bootstrap Regression Analysis to the Spillover of the Technology of Foreign-Invested Enterprises in China," Department of Economics - Working Papers Series 732, The University of Melbourne.
    • Handle: RePEc:mlb:wpaper:732
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    References listed on IDEAS

    as
    1. Borensztein, E. & De Gregorio, J. & Lee, J-W., 1998. "How does foreign direct investment affect economic growth?1," Journal of International Economics, Elsevier, vol. 45(1), pages 115-135, June.
    2. Grossman, Gene M. & Helpman, Elhanan, 1995. "Technology and trade," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 25, pages 1279-1337, Elsevier.
    3. Kamal Saggi, 2002. "Trade, Foreign Direct Investment, and International Technology Transfer: A Survey," The World Bank Research Observer, World Bank, vol. 17(2), pages 191-235, September.
    4. Gary Ferrier & Joseph Hirschberg, 1999. "Can We Bootstrap DEA Scores?," Journal of Productivity Analysis, Springer, vol. 11(1), pages 81-92, February.
    5. Mei Xue & Patrick T. Harker, 1999. "Overcoming the Inherent Dependency of DEA Efficiency Scores: A Bootstrap Approach," Center for Financial Institutions Working Papers 99-17, Wharton School Center for Financial Institutions, University of Pennsylvania.
    6. Ronald Findlay, 1978. "Relative Backwardness, Direct Foreign Investment, and the Transfer of Technology: A Simple Dynamic Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 92(1), pages 1-16.
    7. Gary Ferrier & Joseph Hirschberg, 1997. "Bootstrapping Confidence Intervals for Linear Programming Efficiency Scores: With an Illustration Using Italian Banking Data," Journal of Productivity Analysis, Springer, vol. 8(1), pages 19-33, March.
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    More about this item

    Keywords

    REGRESSION ANALYSIS ; INVESTMENTS ; TECHNOLOGY;
    All these keywords.

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General

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