Impact of Trade Openness and Technology Transfers on Growth: Panel Data Investigation for Developing Countries
The study investigates the causal impact of trade openness and technology transfers on productivity growth in developing countries. We introduce the concept of technologically intensive trade openness (TITO) that can be measured by country approach as imports from highly innovative countries to GDP (employed in the study) or product approach as imports of highly technological products to GDP. We use panel data methods with fixed effects in combination with instrumental variable analysis. We find the time-varying instruments for TITO, among others: one-year lagged industry value added in highly innovative countries weighted by bilateral import shares of a developing country with each innovative country. Our results report that the technologically intensive imports and R&D spillovers from highly innovative countries stay the major channel of international technology diffusion affecting productivity growth in developing countries. On the contrary technologically non-intensive imports (imports from the less innovative countries) tend to have petty or even negative effect on productivity growth. The findings are consistent with the new growth theory and some recent empirical studies. Also educational attainment, domestic R&D activity, use of foreign intellectual property rights and less evidently institutional improvement can positively and substantially increase TFP in a developing country. We also find the interactions between TITO and educational attainments as well as TITO and use of foreign intellectual property rights.
|Date of creation:||06 Nov 2008|
|Date of revision:|
|Contact details of provider:|| Postal: EERC Research Network, Russia and CIS, 92/94, Dmytrivska Str., suite 404, Kyiv, 01135 Ukraine|
Web page: http://www.eercnetwork.com
|Order Information:|| Postal: EERC Research Network, Russia and CIS, 92/94, Dmytrivska Str., suite 404, Kyiv, 01135 Ukraine|
Web: https://eercnetwork.com/paper Email:
When requesting a correction, please mention this item's handle: RePEc:eer:wpalle:08/01e. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Anton Pashchenko)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.