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How institutional quality and economic factors impact technological deepening in developing countries

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  • George R. G. Clarke

    (Development Research Group, The World Bank, Washington DC, USA)

Abstract

This paper assesses the effect of institutional and economic factors on research and development (R&D) expenditures in developing countries. The paper finds that several measures of institutional quality are correlated with R&D expenditures. Since the institutional variables increase as institutional quality improves, this suggests that stronger institutions and better protection of property rights encourage greater R&D expenditures. In addition, foreign direct investment is negatively correlated within R&D expenditures, while defense expenditures are positively correlated with R&D expenditures in some model specifications. Although R&D is not the primary way that developing countries gain access to technology, these results are of interest since R&D might encourage technological deepening better than other methods that developing countries use to gain access to technology (e.g., through FDI or capital goods imports). Copyright © 2001 John Wiley & Sons, Ltd.

Suggested Citation

  • George R. G. Clarke, 2001. "How institutional quality and economic factors impact technological deepening in developing countries," Journal of International Development, John Wiley & Sons, Ltd., vol. 13(8), pages 1097-1118.
  • Handle: RePEc:wly:jintdv:v:13:y:2001:i:8:p:1097-1118 DOI: 10.1002/jid.841
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    Cited by:

    1. Kapeliushnikov, Rostislav & Kuznetsov, Andrei & Demina, Natalia & Kuznetsova, Olga, 2013. "Threats to security of property rights in a transition economy: An empirical perspective," Journal of Comparative Economics, Elsevier, pages 245-264.
    2. Mehmet Ugur, 2013. "Governance, market power and innovation: evidence from OECD countries," Chapters,in: Governance, Regulation and Innovation, chapter 2, pages 25-57 Edward Elgar Publishing.
    3. Benjamin Furlan & Martin Gächter & Bob Krebs & Harald Oberhofer, 2016. "Democratization and Real Exchange Rates," Scottish Journal of Political Economy, Scottish Economic Society, pages 216-242.
    4. Baliamoune-Lutz, Mina & Addison, Tony, 2007. "Economic reform when institutional quality is weak: The case of the Maghreb," Journal of Policy Modeling, Elsevier, vol. 29(1), pages 65-79.
    5. Rita Almeida & Ana Margarida Fernandes, 2008. "Openness and Technological Innovations in Developing Countries: Evidence from Firm-Level Surveys," Journal of Development Studies, Taylor & Francis Journals, pages 701-727.
    6. Faruq, Hasan A., 2011. "How institutions affect export quality," Economic Systems, Elsevier, vol. 35(4), pages 586-606.
    7. Francesco Pasimeni & Paolo Pasimeni, 2016. "An Institutional Analysis of the Europe 2020 Strategy," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, pages 1021-1038.
    8. Aditya Rangga Yogatama & Fithra Faisal Hastiadi, 2015. "The Role of Democracy and Governance in the Enhancement of Indonesian Exports to the Organization of the Islamic Cooperation (OIC) Countries," Working Papers in Economics and Business 201504, Faculty of Economics and Business, University of Indonesia, revised Jul 2015.
    9. Ugur, Mehmet, 2012. "Market Power, Governance and Innovation: OECD Evidence," MPRA Paper 44141, University Library of Munich, Germany.
    10. Ngobo, Paul Valentin & Fouda, Maurice, 2012. "Is ‘Good’ governance good for business? A cross-national analysis of firms in African countries," Journal of World Business, Elsevier, vol. 47(3), pages 435-449.
    11. Neyapti, Bilin, 2013. "Modeling institutional evolution," Economic Systems, Elsevier, vol. 37(1), pages 1-16.
    12. Nuno Torres & Óscar Afonso & Isabel Soares, 2013. "Manufacturing skill-biased wage inequality, natural resources and institutions," CEF.UP Working Papers 1303, Universidade do Porto, Faculdade de Economia do Porto.
    13. Yu, Miaojie, 2010. "Trade, democracy, and the gravity equation," Journal of Development Economics, Elsevier, pages 289-300.
    14. Addison, Tony & Baliamoune-Lutz, Mina N., 2003. "Institutional Quality, Reforms and Integration in the Maghreb," WIDER Working Paper Series 076, World Institute for Development Economic Research (UNU-WIDER).
    15. Ugur, Mehmet, 2012. "Governance, Regulation and Innovation: Introducing New Studies," MPRA Paper 44151, University Library of Munich, Germany, revised Jan 2013.

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