Transcript Document

Trade and technology
transfer: a development
perspective
Alessandro Antimiani (INEA)
Valeria Costantini (Università Roma Tre)
Paolo Liberati (Università Roma Tre)
III Workshop PRIN
Treia, Macerata
03-04 Febbraio 2010
Outline
Introduction
Research questions
Literature Review
Methodology
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Introduction
The process of globalization has led to a greater
integration of less developed countries into the world
economy
The flows of trade, capital, labour, technology, and
information across national borders have accelerated
in recent decades and produced the conditions for
faster economic growth and transmission of
knowledge
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Introduction
Even though the role of international trade in
enhancing economic growth has been recognized
(Dollar and Kraay, 2004)…
much more controversies in the scientific and political
debate arise when a more general development
framework is adopted (Ligon, 2006; Milanovic, 2006).
The impact of globalisation on income distribution
and social development may be strongly uneven
depending on the domestic capacity to transform
economic integration into development opportunities
(Deaton, 2005; Stern and Deardorff, 2006).
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Research questions
To what extent the recent wave of globalisation has
increased knowledge transfer from developed
economies to developing countries
Which factors play a role in explaining the geography
of technological transfer
If technology transfer is an existing phenomenon,
which development dimensions are the most
affected: it is a matter of pure economic growth, or a
wider development perspective could be adopted.
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Literature review

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
Technology transfer
International technology spillovers are crucial factors in
explaining growth performance of advanced economies (Coe
and Helpman, 1995)
and international flows are important drivers of such
spillovers (Eaton and Kortum, 1996)
Transfer via Trade (Keller, 2009; Madsen, 2007; Saggi, 2000)
Transfer via FDI (Gholami et al., 2006; Keller, 2009; Markusen and
Venables, 1999; Saggi, 2000; World Economy Special Issue 2006)
Turning to developing countries this evidence is less strong,
because specific national features assume a greater role in
explaining the capacity to adopt the imported knowledge
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Literature review

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Ancillary conditions
Economic structure similarity (Conley and Ligon, 2002; Franco et
al., 2009)
Specific trade/FDI relationships (Acharya and Keller, 2008 for
ICT; Lumenga-Neso et al., 2001 for indirect trade flows; Xu and Wang,
1999 for capital goods)



The economic integration degree into international
markets (Chinn and Ito, 2006)
The quality of human capital (Coe et al., 2008; Engelbrecht,
1997)
Institutions and the public sector (Coe et al., 2008; Younas,
2009)
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Literature review
Tested effects
Of the role of technology transfer

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Total Factor Productivity (Acharya and Keller, 2007; Coe et al.,
2008; Madsen, 2007; Mendi, 2006; Tang and Coevos, 2008)
Economic Growth (Eaton and Kortum, 1996; Erk et al., 2000;
Conley and Ligon, 2002)
Of the role of a more general concept of trade openness and
capital flows mobility
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
Capital mobility (Chinn and Ito, 2006; Younas, 2009)
Development dimensions (Dalgin et al., 2004)
Income distribution (Ligon, 2006; Topalova, 2005)
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Methodology
Export specialization patterns
z
SI
z
k

z
Xk
RSI
n

X

z
k
k 1
k 1
Xk
n

z
k
W
Xk
z
n
X
z
k

X
W
k
k 1
Similarity matrix (Frenken et al., 2007; Los, 2000)
SM
ij
1k
 SI ki  SI kj

 SI i  SI j
k
k





1
SM
ij
2k
 RSI ki  RSI kj

 RSI i  RSI j
k
k





1
i, j  z
i  j
i= importing countries (145) j= exporting countries (OECD)
k= 19 manufacturing sectors (Isic Rev.3)
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Methodology
Technology transfer measured by knowledge stock
for each k sector (measured by patents as in Bottazzi and
Peri, 2003; Madsen, 2007)
ij
T k  SM 1, 2 k * M k * K k
ij
ij
j
m
TT
i
k
 T 

Total import flows or import shares as in
Acharya and Keller (2008)
ij
k
j 1, j  i
m
TT
i
k

 T
ij
k
* w ij

j 1, j  i
only if i and j are neighbouring
w ij  1
1
w ij  D ij
1
w ij  D ij
only if
D ij  D ij
, otherwise w ij  0
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Methodology
Different aggregation criteria for the k sectors
Simple aggregation,
for total transfer or
for macro-sectors
Variety vs. Concentration
n
i
TT 1TOT 
 TT 
i
k
k 1
n
i
TT 2 TOT 
 TT
i
k
*M
i
k

We can employ a
concentration index
(e.g., Herfindahl) as
autonomous information
or as a weighting factor
for technological transfer
in absolute value
k 1
n
 M 
i
k
k 1
i
H TT 1 , 2 TOT


i
N
TT
 N k

i
k 1
  TT k
 k 1
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




2
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Methodology
Test for alternative dependent variables compared with
pure economic growth. Selected choices:
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Human Development Index (UNDP and WDI)
Human Poverty Index-1 (UNDP and WDI)
Gini index (WDI, UNU-WIDER, Penn World Tables)
Poverty measures (WDI)
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Methodology
Test for alternative representations of the public sector:
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Role of the public sector, as revenue to GDP ratio, or
government expenditures to GDP ratio (WDI)
Institutional quality, as Rule of Law, Government
effectiveness, Corruption index (WDI, Transparency
International, Political Risk Service Group)
Combination of these dimensions in order to control
for the existence of mutual causal relationships.
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Selected references
Acharya, R., Keller, W., 2008, Technology Transfer through Imports, Canadian Journal of
Economics, Vol. 42 (4), pp. 1411-1448.
Bottazzi, L., Peri, G., 2003, Innovation and spillovers in regions: Evidence from European
patent data, European Economic Review, Vol. 47 (4), pp. 687-710.
Coe, D. T., Helpman, E., 1995, International R&D Spillovers, European Economic Review,
Vol. 39, pp. 859-887.
Coe, D.T., Helpman, E., Hoffmaister, A.W., 2008, International R&D Spillovers and
Institutions, NBER Working Papers 14069.
Conley, T.G., Ligon, E., 2002, Economic distance and Cross-Country Spillovers, Journal of
Economic Growth, 7, 157-187.
Dalgin M., Mitra, D., Trindade, V., 2004, Inequality, Nonhomotethic Preferences, and
Trade: A Gravity Approach, NBER Working Paper 10800
Deaton, A., 2005, Measuring Poverty in a Growing World (or Measuring Growth in a Poor
World), The Review of Economics and Statistics, Vol. 87 (1), pp. 1-19.
Dollar, D., Kraay, A., 2004, Trade, growth, and poverty, The Economic Journal, Vol. 114
(493), pp. 22-49.
Eaton, J., Kortum, S., 1996, Trade in Ideas: Patenting and Productivity in the OECD,
Journal of International Economics, Vol. 40, pp. 251-278.
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Selected references
Engelbrecht, H.J., 1997, International R&D Spillovers, Human Capital and Productivity in
OECD Economies: An Empirical investigation, European Economic Review, Vol. 41,
pp. 1479-1488.
Franco, C., Montresor, S., Vitucci Marzetti, G., 2009, On Indirect Trade-Related R&D
Spillovers: the “Average Propagation Length” of foreign R&D, European Corporate
Governance Institute.
Frenken, K., Van Oort, F., Verburg, T., 2007, Related Variety, Unrelated Variety and
Regional Economic Growth, Regional Studies, Vol. 41 (5), pp. 685-697.
Gholami, R., Lee, S.Y.T., Heshmati, A., 2006, The Causal Relationship Between Information
and Communication Technology and Foreign Direct Investment, UNU-WIDER
Working Paper, Helsinki.
Keller, 2009, International trade, Foreign Direct Investment, and technology spillovers,
NBER Working Paper 15442.
Los, B., 2000, The empirical performance of a new inter-industry technology spillover
measure, in Saviotti, P.P., Nooteboom, B. (Eds) Technology and Knowledge, pp. 118-151,
Edward Elgar, Cheltenham.
Lumenga-Neso, O., Olarreaga, M., Schiff, M., 2005, On indirect trade-related R&D
Spillovers, European Economic Review, Vol. 49 (7), pp. 1785-1797.
Madsen, J., 2007, Technology spillovers through trade and TFP convergence: 135 years of
evidence for OECD countries, Journal of International Economics Vol. 72, pp. 464-480.
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Selected references
Markusen, J.R., Venables, A., 1999, Foreign Direct Investment as a Catalyst for Industrial
Development, European Economic Review, Vol 43 (2), pp. 335-356.
Milanovic, B., 2006, Economic Integration and Income Convergence: not such a Strong
Link?, The Review of Economics and Statistics, Vol. 88 (4), pp. 659-670.
Saggi, K., 2000, Trade, Foreign Direct Investment, and International Technology Transfer,
Policy Research Working Paper No. 2349, The World Bank, Washington DC.
Stern, R.M., Deardorff, A.V., 2006, Globalization’s Bystanders: Does Trade Liberalization
Hurt Countries That Do Not Participate?, World Development, Vol. 34 (8), pp. 14191429.
Tang, L., Coveos, P. E., 2008, Embodied and disembodied R&D Spillovers to Developed and
Developing Countries, International Business Review, No. 17, pp. 546-558
Topalova, P., 2005, trade Liberalization, Poverty and Inequality: Evidence from Indian
Districts, NBER Working Paper Series, No. 11614.
World Economy Special Issue 2006, The World Economy, Vol. 29 (19),
Xu, B., Wang, J., 1999, Capital Goods Trade and R&D Spillovers in the OECD, Canadian
Journal of Economics, Vol. 32, pp. 1258-1274.
Younas, J., 2009, Does institutional quality affect capital mobility? Evidence from
developing countries, Journal of Institutional Economics, Vol. 5 (2), pp. 207-223.
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