Spillovers of technology transfer from FDI: the case of Estonia

Abstract

Foreign Direct Investment (FDI) is expected to generate technology spillovers to indigenous firms in transition economies. This paper disentangles the positive effect of technology transfer on the productivity of domestic firms from that of competition. We use a production function framework to estimate the impact of technology transfer from FDI on the growth of sales of domestic firms in Estonia during the period from 1994 to 1999. Employing panel data techniques, we control for industry and firm specific effects and use a Heckman two-stage procedure to control for sample self-selection bias. We find that the magnitude of the spillover effect depends on the characteristics of incoming FDI and, of the recipient local firm. More specifically, spillovers vary with the measure of foreign presence used, and are is influenced by the recipient firm's size, its ownership structure and its trade orientation.

Exploring Firm-Level Innovation and Productivity in Developing Countries: The Perspective of Caribbean Small States

“…Studies from developed and developing countries have shown that FDI spillovers lead to substantial productivity gains and increased innovation activities by domestic firms (Keller and Yeaple, 2009;Javorcik, 2004;Zhang et al, 2009;Liu and Zou, 2008;Chang and Xu, 2008;Girma and Görg, 2007;Sinani and Meyer, 2004;Vahter, 2010;Eden, Levitas, and Martinez, 1997;Kokko, 1996;Buckley, Clegg, and Wang, 2002;Haskel, Pereira, and Slaughter, 2007). Other studies have found no positive spillover effects on innovation and productivity (Damijan and Knell, 2005;Vahter and Masso, 2007;Haddad and Harrison, 1993;Zukowska-Gangelmann, 2000).…”

30 anos de investigação sobre externalidades do IDE para as empresas nacionais: que conclusões?

“…Por um lado, a principal dificuldade associada à utilização de dados cross-section reside na impossibilidade de se estabelecer o sentido da causalidade. Um sinal positivo do coeficiente que capta a dimensão da presença externa pode significar a existência de externalidades positivas para as empresas nacionais ou espelhar, simplesmente, o fato de as EM serem atraídas para setores (ou empresas) mais produtivos (Aitken e Harrison, 1999;Sinani e Meyer, 2004). Ao permitir acompanhar o percurso das empresas nacionais ao longo do período em análise, a estimação em painel possibilita o controle dos efeitos invariantes no tempo que são específicos às empresas e que, provavelmente, estarão correlacionados com a dimensão da presença externa.…”

“…É o caso dos seguintes: a dimensão das empresas nacionais receptoras (Aitken e Harrison, 1999;Sinani e Meyer, 2004), o fato de as empresas nacionais serem ou não exportadoras (Blomström e Sjöholm, 1999;Ponomareva, 2000;Schoors e van der Tol, 2002), o país de origem do IDE (Haskel et al, 2002;Banga, 2003;Karpaty e Lundberg, 2004), o grau de participação externa nos projetos de investimento (Blomström e Sjöholm, 1999;Dimelis e Louri, 2002;Javorcik, 2004), o modo de entrada do IDE (Braconier et al, 2001), a política comercial adotada pelo país receptor (Kokko et al, 2001), a existência de direitos de propriedade intelectual, a dimensão da utilização de insumos intermédios por parte das empresas nacionais, o tipo de formação fornecido pelas EM aos seus trabalhadores (Fosfuri et al, 2001), as formas assumidas pelos contratos entre as empresas nacionais e as EM, o nível de concorrência (Wang;Blomström, 1992), o "valor" da tecnologia introduzida pelas EM (Blomström et al, 2000) ou a motivação do IDE (Fosfuri e Motta, 1999;Driffield e Love, 2002).…”

Foreign Direct Investment in the Western Balkans: What Role Has it Played During Transition?

“…Meyer and Sinani (2009) identify five studies covering the transition region. In three (Liu, 2002 on China;Yudaeva, Kozlov, Melentieva, and Ponomareva, 2003 on Russia;and Sinani and Meyer, 2004 on Estonia), positive spillovers are identified but in two others the effects are found to be negative (Konings, 2001 on Bulgaria and Romania and Djankov and Hoekman, 2000 on Czech Republic). Even so, it is widely argued that FDI played an extremely important role throughout most of the transition region, as a supplement to domestic savings and frequently as a major driver of enterprise restructuring during privatizations (Estrin et al, 2009).…”