The factors affecting technology transaction value in Vietnam: technology demand approach

Purpose - The purpose of this paper is to identify variables and their effects on the value of technology transaction according to technology demand approach in Vietnam technology market, by testing the hypotheses including the effects of technology absorption capacity, internal research and development (R&D) productivity of firms and difficulties in external infrastructure on technology demand. Design/methodology/approach - The technology transaction value and its impact factors are assessed using Vietnam annual enterprise survey and using technology in production survey from 2012 to 2016. The effects of factors on value of technology transaction are determined by using feasible generalized least squares model. Findings - The results indicate three main points. First, companies having higher technology absorption capacity and higher dominance in the domestic or foreign markets tend to acquire higher technology demand in the technology market. Second, companies having lower internal R&D productivity tend to require higher external technology demand. Finally, higher level of difficulty from external infrastructure prevents enterprises in accessing technology demand. Research limitations/implications - The main limitation of the study is that data of firm’s R&D productivity are not available. The study also does not mention information flows from competitors that perhaps have potentially significant impacts on external technology demand of firms. Practical implications - The paper includes policy implications for the government and industry managers to increase technology transaction value. Originality/value - The focus of many previous research papers on technology transactions was generally to look at the decisive factors behind firm’s technology supply in both developed and developing countries. However, knowledge about firm’s technology demand is very limited, particularly in the context of developing countries. This paper clarifies the effect of factors on the decision buying external technology for innovation purpose and productivity improvement in Vietnamese manufacturing sector.