Observing FDI spillover transmission channels: evidence from firms in Uganda

Abstract

We observe and analyse three intra-industry foreign direct investment (FDI) spillover transmission channels using unique firm-level data collected from on-site interviews and observations regarding domestic and foreign firms operating in Uganda in 2015. Our main results are: (1) the spillover effects mainly depend on the channel(s) by which they occur (the competition channel is most important while spillover benefits through the worker mobility and the imitation channels are less prevalent) and (2) both positive and negative spillover effects occur within the same channel and, moreover, effects differ by channel for the same case. These are novel and challenging findings that have not yet been recognised in theoretical and empirical research on FDI spillovers. Our results suggest that long-term pecuniary spillover effects are predominantly stimulated via the competition channel and show that only limited short-term and long-term technological spillover effects occur through the imitation and the movement of workers channels. These channels are not only less prevalent, but also appear to be constrained by competition-determined spillovers. We are confident that these directions for future research will have a high pay-off because, as shown by this exploratory fieldwork, a more complete picture of the spillover effects is reached when the channels are considered simultaneously.     

Geographic and technological R&;D spillovers within the triad: micro evidence from US patents

This paper aims at assessing the magnitude of R&D spillover effects on large international R&D companies’ productivity growth. In particular, we investigate the extent to which R&D spillover effects are intensified by both geographic and technological proximities between spillover generating and receiving firms. We also control for the firm’s ability to identify, assimilate and absorb the external knowledge stock. The results estimated by means of panel data econometric methods (system GMM) indicate a positive and significant impact of both types of R&D spillovers and of absorptive capacity on productivity performance.

University Technology Transfer and Manufacturing Innovation: The Case of Italy

This article analyzes the influence of universities on Italian firms' probability to innovate. Using firm‐level data, we focus on institutionalized technology transfer (TT) activities in universities, namely spin‐offs, patents, and research contracts. Results show that TT activities play a significant role in the probability to innovate by Italian manufacturing firms located in the same province as the university. Nevertheless, the effect is not uniform: the contribution of university TT activities to the probability of firms' innovating is concentrated in certain territorial areas (North‐East and Center) and sectors (science based and scale intensive) and among firms that are large.     

Institution Building and Spillovers

This paper investigates the importance of institution building for economic growth in transition economies of Eastern Europe and CIS‐States. Using recent data, it shows that even in a Guardian State, institutions like property rights protection, administration efficiency, and general rule of low matter. They appear to be even more crucial for economic take‐off than standard economic factors like for example macroeconomic policy. Moreover, this paper finds that there are important spillover effects in institution building, and that countries which get one specific institution right, have also better chances to succeed in making other specific institutions work properly.     

The economics of collective knowledge and technological communication

Technological knowledge can be understood as a collective good when it is the outcome of the integration between internal to the firm investments in R&D and learning and the absorption of competencies and technologies provided by external organizations (such as, other firms, universities, R&D centers). Technological communication is a crucial strategy in such dynamic interaction between the firm and the system. Only under effective conditions of technological communication the private and social benefits derived from the exploitation of spillovers are higher than the private losses due to partial inappropriability. The article presents a simple microeconomic framework to understand knowledge production and distribution, integrating the effects and conditions of technological communication within a knowledge production function. The interaction between internal investments in R&D and learning, partial inappropriability, the conditions for the access to external knowledge and the exploitation of spillovers explains increasing returns in the production of knowledge.

Agglomeration Advantages and Capability Building in Industrial Clusters: The Missing Link

Accumulation of technological capability is crucial for industrial growth and competitiveness of firms, particularly in the context of liberalisation and increasing international economic integration. The article sheds new light on the forces driving capability-building by complementing the micro-economic perspective on learning with a meso-economic perspective that takes account of interaction effects arising from firms' embeddedness in regional networks. The missing link at the interface between the two levels is explored by means of a taxonomy linking various agglomeration advantages to investments in technological effort. The framework results in new policy-relevant insights about the factors underpinning the acquisition of capabilities in comparison to conventional studies. A case study about farm equipment manufacturing in Pakistan's Punjab province is used as an empirical illustration.     

How scientists commercialise new knowledge via entrepreneurship

In this paper, we explore how university-based scientists overcome the barriers to appropriating the returns from new knowledge via entrepreneurship; and we examine how a university-based technology transfer office (TTO), with an incubation facility, can assist scientists in the commercialisation process. We identify how scientists overcome three barriers to commercialisation. First, we find that scientists take account of traditional academic rewards when considering the pay-offs of commercialisation activity. Second, scientists recognise the commercial value of new knowledge when market-related knowledge is embedded in their research context, and/or when they develop external contacts with those with market knowledge. Third, the deliberate efforts of scientists to acquire market information results in individuals or organisations with market knowledge learning of the new knowledge developed by the scientists; and intermediaries can help individuals or organisations with resources learn of new knowledge developed by scientists. We find that the TTO, principally through an enterprise development programme (CCDP), played an important role in the commercialisation process. The principal benefit of the TTO is in the domain of putting external resource providers in contact with scientists committed to commercialisation. Our findings have important implications for scientists and for those interested in promoting commercialisation via entrepreneurship.

Do Pilot and Demonstration Projects Work? Evidence from a Green Building Program

Pilot and demonstration (P&D) projects are commonly deployed to catalyze early adoption of technology but are poorly understood in terms of mechanism and impact. We conceptually distinguish unique functions of pilots and demonstrations, then examine whether they accelerate adoption in the case of green building technology. To identify effects on adoption, we develop a difference-in-difference-in-differences strategy, exploiting variation in timing, location, and technologies of green building P&Ds. Results indicate local quarterly green building adoption rates double following completion of a P&D project. Further analyses examine mechanisms driving this effect. The results suggest green building demonstration projects create learning externalities, proliferating technology diffusion in local markets and through building owner networks. Together, these results suggest that investments in P&D projects by public and private actors can lower costs for subsequent adoption.     

Technology spillovers and stability of international climate coalitions

Cooperation in international environmental agreements appears difficult to attain because of strong free-rider incentives. This paper explores how different technology spillover mechanisms among regions can influence the incentives to join and stabilise an international agreement. We use an applied modelling framework (STACO) that enables us to investigate the stability of partial climate coalitions. Several theories on the impact of technology spillovers are evaluated by simulating a range of alternative specifications. We find that spillovers are a good instrument to increase the abatement efforts of coalitions and reduce the associated costs. In our setting, however, they cannot overcome the strong free-rider incentives that are present in larger coalitions, i.e. technology spillovers do not substantially increase the success of international environmental agreements. This conclusion is robust with respect to the specification of technology spillovers.

Quality of government and regional competition: A spatial analysis of subnational regions in the European Union

Building on previous work on competition networks and governmental performance among British local governments, this article investigates the diffusion of government quality across subnational regions of Europe through strategic interaction with neighbouring regions or competitor regions more generally. The article demonstrates the presence of spatial interdependence using standard spatial regression models and controlling for common explanations of quality of government. In particular for regions with high levels of autonomy from the national government, there is clear adjustment in government quality to be seen in response to disparities with competitor regions. The article further investigates the intensity of this geographical effect separately in the north and south of Europe in order to estimate the potential for virtuous or vicious cycles of good governance in the two regions, respectively. It is found that while regions in the north develop relatively independently of each other but respond to competitive pressure across Europe, in the south regions demonstrate a higher level of local interdependence, increasing the possibility of virtuous cycles – but also of vicious ones.