Working Paper: CEPR ID: DP3711
Authors: Maurice Schiff; Yanling Wang; Marcelo Olarreaga
Abstract: This Paper examines the impact on TFP of North-South and South-South trade-related R&D spillovers. It is the first, as far as we know, to do so at the industry level for developing countries. North-South and South-South R&D flows are constructed based on industry-specific R&D in the North, North-South and South-South trade patterns, and input-output relations in the South. The main findings are: i) North-South and South-South R&D flows have a positive impact on TFP, though the former is larger; and ii) R&D-intensive industries benefit mainly from North-South R&D flows while low R&D-intensity industries benefit mainly from South-South R&D flows. These results have implications for the productivity dynamics of North-South and South-South regional integration.
Keywords: developing countries; technology diffusion; trade
JEL Codes: F01
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| North-South R&D flows (O36) | TFP (F16) |
| South-South R&D flows (O39) | TFP (F16) |
| Education (I29) | TFP (F16) |
| North-South R&D flows (O36) | TFP (R&D-intensive industries) (O39) |
| South-South R&D flows (O39) | TFP (low R&D intensity industries) (O39) |