Productivity spillovers from technology transfer to Indian manufacturing firms

Abstract

The present paper employs techniques from stochastic production frontier and panel data literature to test a spillover hypothesis for large sized ®rms that`presence of foreign-owned ®rms and foreign technical capital stock in a sector leads to reduced dispersion in eciency in the sector and fall is higher for the ®rms that invest in R&D activities'. Dispersion being a relative concept, it may still fall if both the leading foreign ®rm and domestic ®rms show fall in technical eciency over the period and the fall for the leader is higher and vice versa. Given the focus of the study, where concern is for the learning by the domestic ®rms, the study tries to get around with the problem partially, by testing the hypothesis for those local ®rms that have shown productivity improvement over the period. Results suggest that foreign-owned ®rms are close to the frontier in 13 of the total 26 sectors studied. Spillovers result for these 13 sectors indicate that there exist negative spillovers from the presence of foreign ®rms in the sector, but available foreign technical capital stock has a positive impact. Interesting dierences emerge when the sample is bifurcated into scienti®c and non-scienti®c subgroups. Results for the scienti®c subgroup indicate that the indirect gains or spillovers are not automatic consequence of foreign ®rm's presence, but they depend to a large extent on the eorts of local ®rms to invest in learning or R&D activities so as to decodify the spilled knowledge. On the other hand, the evidence of spillovers to non-scienti®c non-FDI ®rms is not very strong.

Technological Spillovers from Multinational Companies to Small and Medium Food Companies in Nigeria

“…The first group of empirical studies used cross-sectional data in a single year and found positive spillovers (Caves, 1974;Globerman, 1979;Blomström and Person, 1983;Blomström and Wolff, 1994;Nadiri, 1991;Blomström and Sjöoholm, 1998). But the set of second group of studies, which used panel data, found negative spillovers (Aitken and Harrison, 1999;Djankov and Hoeckman, 2000;Kathuria, 2000;Konings, 2000). The findings pointed out that many of the earlier studies, that found positive spillovers, did not introduce control variables of sectoral nature.…”

Foreign Direct Investments Induced Innovation? A Case Study – Macedonia

“…On the other hand, they can also have a crowding-out effect on the domestic-owned firms which are not able to meet the competitive arrangements that foreign-owned firms impose on the market, that is, horizontal spillovers. Negative effects can occur in two ways (Aitken, Harrison et al 1996;Aitken, Hanson et al 1997;Aitken and Harrison 1999;Kokko 1994;Kathuria 2000): 1) foreign-owned firms can appropriate the domestic market; or foreignowned firms attract the finest human capital, thus starving the local economy of good quality resources. The literature notes that these negative effects are usually conditioned on several factors in different parts of the world (Blomström and Sjöholm 1999;Konings 2001;Gorodnichenko 2007).…”

Investimento direto externo, acumulação de capital produtivo e distribuição de renda: uma abordagem pós-keynesiana

“…Djankov e Hoekman (2000) e Kathuria (2000) encontram efeitos negativos da presença de multinacionais sobre as firmas domésticas, usando dados de painel para as indústrias da República Tcheca e Índia, respectivamente. Por outro lado, outros trabalhos, como Driffield (2000) e Liu et al (2000), ambos para indústrias do Reino Unido, detectam resultados positivos.…”