Imported Machinery for Export Competitiveness
This article analyzes the relationship between export competitiveness and investment in machinery, allowing for imperfect substitution between domestically produced and imported machinery. A translog export price function is estimated for developed, exportoriented developing, and import-substituting developing economies in a panel data setting. Between 1967 and 1990 imported machinery helped lower export prices for export-oriented developing economies. Moreover, throughout the period imported machinery was not a substitute for domestic machinery. Import-substituting developing economies were unable to harness imported machinery to reduce costs early in the period, but from about the early 1980s, with the opening of their trade regimes, they were able to benefit from the cost-reducing effect. The results imply that innovative effort based on imported technologies can be a precursor to the development of domestic innovation capabilities. Copyright 2002, Oxford University Press.
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Volume (Year): 16 (2002)
Issue (Month): 1 (June)
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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kenichi Ohno, 1989. "Export Pricing Behavior of Manufacturing: A U.S.: Japan Comparison," IMF Staff Papers, Palgrave Macmillan, vol. 36(3), pages 550-579, September.
- Mody, Ashoka & Yilmaz, Kamil & DEC, 1994.
"Is there persistence in the growth of manufactured exports? Evidence from newly industrializing countries,"
Policy Research Working Paper Series
1276, The World Bank.
- Mody, Ashoka & Yilmaz, Kamil, 1997. "Is there persistence in the growth of manufactured exports? Evidence from newly industrializing countries," Journal of Development Economics, Elsevier, vol. 53(2), pages 447-470, August.
- Pindyck, Robert S & Rotemberg, Julio J, 1983. "Dynamic Factor Demands and the Effects of Energy Price Shocks," American Economic Review, American Economic Association, vol. 73(5), pages 1066-79, December.
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