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Trade policies, enterprise characteristics and technological effort in developing countries

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  • Homi Katrak

    (University of Surrey)

Abstract

This paper examines whether a developing country's import restrictions are likely to increase or decrease the technological effort of its enterprises. The analysis incorporates a profit incentive effect, which induces an increase in output and technological effort of the protected enterprises, and an opposing X-inefficiency effect. The paper shows that the relative importance of these effects may differ between industries and also between enterprises in the same industry, depending on the nature of their products, their size and other characteristics. Consequently import restrictions may increase the technological effort of some enterprises, but have the opposite outcome in some others.

Suggested Citation

  • Homi Katrak, 1996. "Trade policies, enterprise characteristics and technological effort in developing countries," Journal of International Development, John Wiley & Sons, Ltd., vol. 8(1), pages 39-51.
    • Handle: RePEc:wly:jintdv:v:8:y:1996:i:1:p:39-51
    DOI: 10.1002/(SICI)1099-1328(199601)8:1<39::AID-JID262>3.0.CO;2-O
    as

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    References listed on IDEAS

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    1. Helleiner, G. K., 1990. "Trade strategy in medium-term adjustment," World Development, Elsevier, vol. 18(6), pages 879-897, June.
    2. Beath, John & Katsoulacos, Yannis & Ulph, David, 1989. "Strategic R&D Policy," Economic Journal, Royal Economic Society, vol. 99(395), pages 74-83, Supplemen.
    3. Martin Fransman, 1984. "Technological Capability in the Third World: An Overview and Introduction to some of the Issues raised in this Book," Palgrave Macmillan Books, in: Martin Fransman & Kenneth King (ed.), Technological Capability in the Third World, pages 3-30, Palgrave Macmillan.
    4. Kaluwa, Benson M & Reid, Gavin C, 1991. "Profitability and Price Flexibility in Manufacturing for a Developing Country," Journal of Industrial Economics, Wiley Blackwell, vol. 39(6), pages 689-700, December.
    5. Katrak, Homi, 1989. "Imported technologies and R&D in a newly industrialising country : The experience of Indian enterprises," Journal of Development Economics, Elsevier, vol. 31(1), pages 123-139, July.
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    Cited by:

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    2. Haruna Shoji & Goel Rajeev K., 2016. "International Tariffs in a Mixed Oligopoly with Research Spillovers," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 22(3), pages 277-293, August.

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