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Trade and Private R&D in Mexico

Author

Listed:
  • Liliana Meza González

    () (Universidad Iberoamericana, Departamento de Economía, Mexico City)

  • Ana Belén Mora Yague

    () (Georgetown University, Economics Department, Washington, DC)

Abstract

Using the National Survey on Employment, Wages, Technology and Training (Enestyc), this paper tries to find the relationship between increasing trade and the proportion of total income Mexican manufacturing firms invest on R&D. Based on two crosssectional and a panel estimation procedures, the results confirm the idea that increasing the exposure to foreign markets affect the innovative efforts of Mexican firms. We also find that the firms engaging in some kind of R&D do not conform a random sample. More specifically, our results show that, in 1992, the probability of finding a firm engaging resources in some kind of R&D increased with size, a market diversification measure, and a measure of industrial market power at a 2-digit level, while the intensity of the R&D effort depended, on market power and an industry concentration measure. For the 1999 estimation our results show that the probability of R&D investment at a firm level increased with size, a market diversification measure, and exposure to foreign competition, while the magnitude of the R&D effort of a firm was determined by the decrease in average import tariffs at the industry level and by the exporting efforts of the firm. We find strong complementarities between public and private innovation efforts in both years, but find that younger firms are doing stronger R&D efforts in 1999. The 1992- 99 balanced panel results show that exporting firms invest more in R&D while import competing firms invest less, once size, market power and other control variables are taken into account. Our estimation indicates that exporting give firms a great incentive to innovate, and that not only large, but also small firms contribute to the R&D efforts of a nation.

Suggested Citation

  • Liliana Meza González & Ana Belén Mora Yague, 2005. "Trade and Private R&D in Mexico," Economía Mexicana NUEVA ÉPOCA, , vol. 0(2), pages 157-183, July-Dece.
  • Handle: RePEc:emc:ecomex:v:14:y:2005:i:2:p:157-183
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    References listed on IDEAS

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    6. Eaton, Jonathan & Kortum, Samuel, 1996. "Trade in ideas Patenting and productivity in the OECD," Journal of International Economics, Elsevier, vol. 40(3-4), pages 251-278, May.
    7. Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation And Productivity: An Econometric Analysis At The Firm Level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 115-158.
    8. Cohen, Wesley M & Levin, Richard C & Mowery, David C, 1987. "Firm Size and R&D Intensity: A Re-examination," Journal of Industrial Economics, Wiley Blackwell, vol. 35(4), pages 543-565, June.
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    Citations

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    Cited by:

    1. Wang, Eric C., 2010. "Determinants of R&D investment: The Extreme-Bounds-Analysis approach applied to 26 OECD countries," Research Policy, Elsevier, vol. 39(1), pages 103-116, February.
    2. Liliana Meza González, 2016. "Internacionalización y creación de nuevos productos y procesos en la industria manufacturera mexicana," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 31(2), pages 235-263.
    3. Kosacoff, Bernardo & López, Andrés & Pedrazzoli, Mara, 2008. "Trade, investment and fragmentation of the global market: is Latin America lagging behind?," Estudios y Perspectivas – Oficina de la CEPAL en Buenos Aires 39, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).

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