Competitiveness, FDI and Technological Activity in East Asia (original) (raw)
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This paper examines the links between ownership, innovation and exporting in electronics firms in three late industrializing East Asian countries (China, Thailand and the Philippines) drawing on recent developments in applied international trade and innovation and learning. Technology-based approaches to trade offer a plausible explanation for firm-level exporting behavior. The econometric results (using probit) confirm the importance of foreign ownership and innovation in increasing the probability of exporting in electronics. Higher levels of skills, managers' education and capital also matter in China as well as accumulated experience in Thailand. Furthermore, a technology index composed of technical functions performed by firms emerges as a more robust indicator of innovation than the R&D to sales ratio. Accordingly, technological effort in electronics in these countries mostly focuses on assimilating and using imported technologies rather than formal R&D by specialized engineers. JEL Codes: F23, O31, O32, L63, O57 . I am very grateful for comments from Pierre Mohnen, Peter Petri, Garry Jefferson, Xingmin Yin and for research assistance from Rosechin Olfindo. I would also like to thank other participants of The Second Conference on Micro Evidence on Innovation and Development (co-organized by UNUMERIT and Renmin University in Beijing) and the International Conference on Investments, Technology Spillovers and East Asian FTAs (co-organized by Fudan University and Brandeis University in Shanghai). The views expressed here are solely mine and not to be attributed to the ADB. 4 5 I.