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Technological Innovation in New European Union Markets

Author

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  • Ainura Uzagalieva

    (Centre of Applied Economics Studies of the Atlantic at the Department of Economics and Management, the University of the Azores, Portugal)

  • Evžen Kočenda
  • Antonio Menezes

Abstract

We analyze the role of innovation in the technological development of four new EU members: the Czech Republic, Hungary, Poland and Slovakia. For that purpose, we use a novel approach by modeling the empirical relationship between intra-industrial bilateral trade flows, which proxy the level of technological progress, and innovation expenditures within the context of a gravity model with a set of appropriate instrumental variables to account for the potential endogeneity of innovation to trade. We show that innovation efforts in high-tech industries exhibit a strong effect on the technological progress of the region and they are closely linked to foreign direct investment and multinationals. As foreign-owned subsidiaries become a part of the innovation systems and industrial structure of the host country they promote overall technological growth in the region.

Suggested Citation

  • Ainura Uzagalieva & Evžen Kočenda & Antonio Menezes, 2012. "Technological Innovation in New European Union Markets," Working Papers 312, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies).
    • Handle: RePEc:ost:wpaper:312
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    References listed on IDEAS

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    Cited by:

    1. Richard Frensch & Jan Hanousek & Evžen Kocenda, 2012. "Incomplete specialization and offshoring across Europe," FIW Working Paper series 091, FIW.
    2. Jan Hanousek & Evzen Kocenda & Pavla Vozárová, 2020. "Impact of Multinational Enterprises on Competition, Productivity and Trade Spillovers across European Firms," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 70(2), pages 172-212, August.
    3. Richard Frensch & Jan Hanousek & Evzen Kocenda, 2016. "Trade in Parts and Components across Europe," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 66(3), pages 236-262, June.
    4. Richard Frensch & Jan Hanousek & Evžen Kočenda, 2012. "Specialization, gravity, and European trade in final goods," Working Papers 320, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies).
    5. Jan Hanousek & Evzen Kocenda & Pavla Vozarova, 2017. "Productivity and Trade Spillovers: Horizontal Crowding-Out Versus Vertical Synergies in Europe as a Response to Foreign Direct Investment," CERGE-EI Working Papers wp601, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    6. Richard Frensch & Jan Hanousek & Evžen Kočenda, 2013. "Obchod s fiskálními statky v Evropské unii: Analýza za pomoci gravitačního modelu [Trade with Final Goods in European Union: A Gravity Model Approach]," Politická ekonomie, Prague University of Economics and Business, vol. 2013(6), pages 715-734.
    7. Jan Hanousek & Evžen Kočenda & Pavla Vozárová, 2017. "Vliv Přímých Zahraničních Investic Na Dodavatelské Vztahy A Postavení Domácích Výrobců Meziproduktů [FDI's Impact on Inter-industry Interactions among Domestic Suppliers of Intermediate Goods]," Politická ekonomie, Prague University of Economics and Business, vol. 2017(4), pages 391-409.
    8. Hanousek, Jan & Kočenda, Evžen & Mašika, Michal, 2012. "Firm efficiency: Domestic owners, coalitions, and FDI," Economic Systems, Elsevier, vol. 36(4), pages 471-486.
    9. Bessonova, Evguenia & Gonchar, Ksenia, 2017. "Incentives to innovate in response to competition: The role of agency costs," Economic Systems, Elsevier, vol. 41(1), pages 26-40.
    10. Jan Hanousek & Evžen Kočenda, 2015. "Determinanty evropského zahraničního obchodu: instituce, kultura, infrastruktura a geografie [Determinants of the European Trade: Institutions, Culture, Infrastructure and Geography]," Politická ekonomie, Prague University of Economics and Business, vol. 2015(5), pages 624-640.
    11. Hanousek, Jan & Kočenda, Evžen & Shamshur, Anastasiya, 2015. "Corporate efficiency in Europe," Journal of Corporate Finance, Elsevier, vol. 32(C), pages 24-40.
    12. Jan Hanousek & Evžen Kočenda & Anastasiya Shamshur, 2014. "Efektivita evropských firem [Efficiency of European Firms]," Politická ekonomie, Prague University of Economics and Business, vol. 2014(3), pages 303-322.
    13. Jan Hanousek & Evzen Kocenda, 2016. "FDI and Ownership in Czech Firms: Pre- and Post-crisis Efficiency," KIER Working Papers 942, Kyoto University, Institute of Economic Research.
    14. Hanousek, Jan & Kočenda, Evžen, 2014. "Factors of trade in Europe," Economic Systems, Elsevier, vol. 38(4), pages 518-535.
    15. Jan Hanousek & Evžen Kočenda & Michal Mašika, 2012. "Firemní efektivita: vliv vlastnických struktur a finančních ukazatelů [Corporate Efficiency: Effect of Ownership Structures and Financial Indicators]," Politická ekonomie, Prague University of Economics and Business, vol. 2012(4), pages 459-483.

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    More about this item

    Keywords

    foreign direct investment; innovation; imitation; international trade; European Union;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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