Foreign direct investment, technological advancement, and absorptive capacity: A network analysis

Sultana, Nasrin; Turkina, Ekaterina

doi:10.1016/j.ibusrev.2020.101668

Cited by 68 publications

(55 citation statements)

References 90 publications

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“…First, we add new evidence to a firm's absorptive capacities when learning from FDI advanced technology. Unlike previous literature that mainly focuses on the stock of human capital and R&D investment (Girma, 2005;Sultana & Turkina, 2020), we dig into their structures and highlight the importance of human capital and R&D strategies diversity in the local absorption of FDI spillovers. Second, we innovatively examine a threshold moderating effect of a firm's human capital composition and R&D strategies.…”

Section: Introductionmentioning

confidence: 99%

How do human capital and R&D structure facilitate FDI knowledge spillovers to local firm innovation? a panel threshold approach

2021

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This paper examines how local firms’ structure of human capital and R&D strategies influence their absorption of FDI knowledge spillovers. Using a unique dataset of Chinese firms in Beijing Zhongguancun Science Park from 2009 to 2015, our panel endogenous threshold models confirm two thresholds for human capital diversity and one threshold for R&D diversity in facilitating FDI spillovers. When human capital diversity is below its second threshold, FDI presence positively influences local firms’ innovation performance; while above the second threshold, the FDI turns to an insignificant impact. Besides, when R&D diversity is below its single threshold, FDI spillovers are positively associated with local firms’ innovation; otherwise, the effect of FDI is insignificantly negative. Our findings highlight the importance of human capital and R&D structures in local firms’ absorptive capacity. Local organizations need to keep diversifying their human capital and R&D strategies to learn from FDI knowledge but avoid allocating their efforts evenly upon sub-categories within the two resources.

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Section: Introductionmentioning

confidence: 99%

How do human capital and R&D structure facilitate FDI knowledge spillovers to local firm innovation? a panel threshold approach

2021

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“…Despite some critiques of this indicator in the existing literature (see e.g. Edquist et al, 2018;Švandová and Jirásek, 2019), it is a commonly used indicator of innovation performance within empirical literature (e.g. Albulescu and Drăghici, 2016;Janoskova and Kral, 2019).…”

Section: Methodsmentioning

confidence: 99%

“…by Filippetti, Frenz and Ietto-Gillies (2017). According to Sultana and Turkina (2020) the country can benefit from inward FDI only through a better understanding of absorptive capacity and the transformation of its related factors.…”

Section: Figure 2 -Outward Fdi -Innovation Performance Matrixmentioning

confidence: 99%

Does Foreign Direct Investment Boost Innovation? The Case of the Visegrad and Baltic Countries

2020

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Purpose: The purpose of the paper is to examine the impact of inward and outward foreign direct investment on innovation performance of the Visegrad and Baltic countries.Methodology/Approach: The study follows an open-system approach to consider the determinants of national innovation performance, taking into account both inward and outward FDI. We use two-step analysis that combines panel data regression analysis with the design of two FDI – innovation performance matrixes.Findings: The results of the study provide evidence that only outward foreign direct investment of domestic firms contributes significantly to the innovation performance of these countries and that this effect is more visible in the case of the Visegrad countries.Research Limitation/Implication: The limitations of the study are associated in particular with the selection of SII as a measure of national innovation performance. The use of this indicator is also related to the relatively short period of availability of consistent data, especially in connection with changes in the methodology of SII calculation.Originality/Value of paper: The policy implications of the paper suggest the need for stronger support of domestic bearers of cross-border capital movements in an attempt to boost national innovation performance.

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“…The stronger the AC of an enterprise is, the stronger its ability is to learn and master the external environment that applies the external knowledge in the opportunity state. A series of empirical studies have indicated that AC is closely linked with technology acquisition (Kim et al , 2019; Sultana and Turkina, 2020). Veugelers (1997) proposed that AC moderates the level of innovation activity.…”

Section: Theoretical Development and Hypothesesmentioning

confidence: 99%

Transnational knowledge transfer or indigenous knowledge transfer: which channel has more benefits for China's high-tech enterprises?

Deng

2021

EJIM

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PurposeThis paper compares four external technology acquisition channels' (foreign technology transfer, exporting, inter-industry R&D spillover and domestic technology transfer) contributions to Chinese high-tech enterprises' innovation in the moderating role of absorptive capacity (AC).Design/methodology/approachUsing technological catch-up theory and China Statistics Yearbook on High Technology Industry, this research investigates 16 Chinese high-tech industries from 2004 to 2015 via negative binomial regression.FindingsThe results show that indigenous knowledge transfer improves foreign-funded enterprises' (FFEs) innovation, while transnational knowledge transfer is the main channel for state-owned enterprises' (SOEs) technology acquisition. AC strengthens the positive relationship between transnational knowledge transfer and innovation in SOEs and improves FFEs' innovation and exported tacit knowledge absorption.Originality/valueThis study contributes to the literature on external technology acquisition (ETA) and innovation by examining the different mechanism of ETA instead of isolated strategy considering the AC and ownership structure of Chinese high-tech enterprises, which enrich the technological catch-up theory.

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Foreign direct investment, technological advancement, and absorptive capacity: A network analysis

Cited by 68 publications

References 90 publications

How do human capital and R&D structure facilitate FDI knowledge spillovers to local firm innovation? a panel threshold approach

How do human capital and R&D structure facilitate FDI knowledge spillovers to local firm innovation? a panel threshold approach

Does Foreign Direct Investment Boost Innovation? The Case of the Visegrad and Baltic Countries

Transnational knowledge transfer or indigenous knowledge transfer: which channel has more benefits for China's high-tech enterprises?

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