International R&D Transfer and Technical Efficiency: Evidence from Panel Study Using Stochastic Frontier Analysis
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We study the effect of foreign research and development (R&D) transferred through imports and foreign direct investment (FDI) on domestic technical efficiency using stochastic frontier analysis. Unbalanced panel results from a 77-country sample over 1986–2007 show that FDI- and imports-transferred foreign R&D have a significant impact on domestic country’s technical efficiency. Furthermore, we observe a complementarity between FDI-transferred R&D and domestic human capital. In other words, the domestic country needs to obtain a threshold level of human capital to benefit from FDI-transferred R&D. Other macro conditions such as infrastructure, political stability, and urbanization also help to improve the technical efficiency of a country.
Wang, Miao and Wong, M. C. Sunny, "International R&D Transfer and Technical Efficiency: Evidence from Panel Study Using Stochastic Frontier Analysis" (2012). Economics Faculty Research and Publications. 130.
Accepted version. World Development, Vol. 40, No. 10 (October 2012): 1982–1998. DOI. Published under Creative Commons license Attribution-NonCommercial-NoDerivatives 4.0 International.