IDEAS home Printed from https://ideas.repec.org/p/wii/bpaper/012.html
   My bibliography  Save this paper

Recovery and Growth in the Manufacturing Sectors of CEE Transition Economies: Short and Long-Term Efficiency Improving Factors

Author

Listed:
  • Joze P. Damijan
  • Boris Majcen

Abstract

The first aim of the paper was to explain a cross-sector differences in evolution of gross product of Slovenian manufacturing sectors in the period 1992-98 using different short and long-term factors. Results pointed out great importance of initial conditions (sector orientation to convertible or non-convertible markets, and distorted production structure), as well as structural reforms and macroeconomic and institutional environment. Added long-term factors revealed positive association with short term output growth during the transition period – it is obvious that these factors (FDI, exports, imports of inputs, cooperation) create channels for the transfer of technology, improving the efficiency of production. It turned out also that quality improving exports to the EU countries is significantly positively correlated with the sector output performance. The paper further studies the importance of both direct and indirect means of technology transfer for transition countries and its impact on productivity growth of local firms. Using firm-level data for eight transition countries for the period 1994 - 1998 and employing growth accounting approach, the paper explores the importance of FDI, intra-industry knowledge spillovers from FDI, firm's own R&D accumulation and of international R&D spillovers through trade for firm's TFP growth. Time-invariant firmspecific effects are taken into account using panel data techniques, and potential selection bias for foreign investment decisions is corrected by using a generalized Heckman two-step procedure. After controlling for common economic policy influences and industry effects, our results confirm for five advanced transition countries that technology is being transferred to domestic firms primarily through direct foreign linkages. Evidence on some international R&D spillovers through arm-length trade has been found for four transition countries. Our results also suggest that FDI do not generate positive intra-industry spillovers for domestic firms. Moreover, for three transition countries FDI were found to have significant crowding-out effects for local firms in the same industry.

Suggested Citation

  • Joze P. Damijan & Boris Majcen, 2001. "Recovery and Growth in the Manufacturing Sectors of CEE Transition Economies: Short and Long-Term Efficiency Improving Factors," wiiw Balkan Observatory Working Papers 12, The Vienna Institute for International Economic Studies, wiiw.
    • Handle: RePEc:wii:bpaper:012
    as

    Download full text from publisher

    File URL: https://wiiw.ac.at/recovery-and-growth-in-the-manufacturing-sectors-of-cee-transition-economies-short-and-long-term-efficiency-improving-factors-dlp-3319.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    3. Selowsky, Marcelo & Martin, Ricardo, 1997. "Policy Performance and Output Growth in the Transition Economies," American Economic Review, American Economic Association, vol. 87(2), pages 349-353, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Konstantins Benkovskis & Ludmila Fadejeva & Julia Wörz, 2013. "How Important Is Total Factor Productivity for Growth in Central, Eastern and Southeastern European Countries?," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 1, pages 8-27.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Luis Garicano & Thomas N. Hubbard, 2016. "The Returns to Knowledge Hierarchies," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 32(4), pages 653-684.
    2. B. Bhaskara Rao & Arusha Cooray, 2012. "How useful is growth literature for policies in the developing countries?," Applied Economics, Taylor & Francis Journals, vol. 44(6), pages 671-681, February.
    3. Sina T. Ates & Felipe E. Saffie, 2013. "Project Heterogeneity and Growth: The Impact of Selection," PIER Working Paper Archive 13-011, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    4. Cui, Dan & Wei, Xiang & Wu, Dianting & Cui, Nana & Nijkamp, Peter, 2019. "Leisure time and labor productivity: A new economic view rooted from sociological perspective," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 13, pages 1-24.
    5. Ryan, Michael P., 2010. "Patent Incentives, Technology Markets, and Public-Private Bio-Medical Innovation Networks in Brazil," World Development, Elsevier, vol. 38(8), pages 1082-1093, August.
    6. Maurice Schiff & Yanling Wang, 2010. "North-South Technology Spillovers: The Relative Impact of Openness and Foreign R&D," International Economic Journal, Taylor & Francis Journals, vol. 24(2), pages 197-207.
    7. Ponticelli, Jacopo & Bustos, Paula & Castro-Vincenzi, Juan & Monras, Joan, 2018. "Industrialization without Innovation," CEPR Discussion Papers 13379, C.E.P.R. Discussion Papers.
    8. Tol, Richard S.J., 2007. "Carbon dioxide emission scenarios for the USA," Energy Policy, Elsevier, vol. 35(11), pages 5310-5326, November.
    9. Oleg Badunenko & Diego Romero-�vila, 2014. "Productivity Growth across Spanish Regions and Industries: A Production-Frontier Approach," Regional Studies, Taylor & Francis Journals, vol. 48(7), pages 1242-1262, July.
    10. Valerien O. Pede & Raymond J. G. M. Florax & Henri L. F. De Groot, 2007. "Technological Leadership, Human Capital and Economic Growth: a Spatial Econometric Analysis for US Counties, 1969-2003," Annals of Economics and Statistics, GENES, issue 87-88, pages 103-124.
    11. Durlauf, Steven N. & Quah, Danny T., 1999. "The new empirics of economic growth," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308, Elsevier.
    12. Alejandro Díaz-Bautista & Jorge Eduardo Mendoza Cota, 2004. "Regional Convergence Of Income And Labor Productivity In Mexico," Remef - Revista Mexicana de Economía y Finanzas Nueva Época REMEF (The Mexican Journal of Economics and Finance), Instituto Mexicano de Ejecutivos de Finanzas, IMEF, vol. 3(1), pages 3-20, Marzo 200.
    13. Renelt, David, 1991. "Economic growth : a review of the theoretical and empirical literature," Policy Research Working Paper Series 678, The World Bank.
    14. Dur, Robert & Glazer, Amihai, 2008. "Subsidizing Enjoyable Education," Labour Economics, Elsevier, vol. 15(5), pages 1023-1039, October.
    15. Drivas, Kyriakos & Economidou, Claire & Karamanis, Dimitrios & Sanders, Mark, 2020. "Mobility of highly skilled individuals and local innovation activity," Technological Forecasting and Social Change, Elsevier, vol. 158(C).
    16. Vîntu, Denis, 2022. "An application: Pension systems and transitions," MPRA Paper 113128, University Library of Munich, Germany, revised May 2022.
    17. Baptista, Rui & Swann, Peter, 1998. "Do firms in clusters innovate more?," Research Policy, Elsevier, vol. 27(5), pages 525-540, September.
    18. Alberola, Enrique & Benigno, Gianluca, 2017. "Revisiting the commodity curse: A financial perspective," Journal of International Economics, Elsevier, vol. 108(S1), pages 87-106.
    19. Xepapadeas, Anastasios, 1997. "Economic development and environmental pollution: traps and growth," Structural Change and Economic Dynamics, Elsevier, vol. 8(3), pages 327-350, August.
    20. Feldman, Maryann P. & Audretsch, David B., 1996. "Location, location, location: The geography of innovation and knowledge spillovers," Discussion Papers, various Research Units FS IV 96-28, WZB Berlin Social Science Center.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wii:bpaper:012. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Customer service (email available below). General contact details of provider: https://edirc.repec.org/data/wiiwwat.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.