Working Paper: CEPR ID: DP3805
Authors: Wolfgang Keller; Stephen R. Yeaple
Abstract: We estimate international technology spillovers to US manufacturing firms via imports and foreign direct investment (FDI) between the years 1987-96. In contrast to earlier work, our results suggest that FDI leads to significant productivity gains for domestic firms. The size of FDI spillovers is economically important, accounting for about 14% of productivity growth in US firms between 1987-96. In addition, there is some evidence for imports-related spillovers, but it is weaker than for FDI. The Paper also gives a detailed account of why our study leads to results different from those found in previous work. This analysis indicates that our results are likely to generalize to other countries and periods.
Keywords: Foreign Direct Investment; Learning; Externalities; Technology Spillovers
JEL Codes: F10; F20; O30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| foreign direct investment (FDI) (F23) | productivity growth (O49) |
| imports (F14) | productivity growth (O49) |
| foreign direct investment (FDI) (F23) | total factor productivity (TFP) growth (O49) |
| imports (F14) | total factor productivity (TFP) growth (O49) |