FDI inflows and R&D activity in developing countries
This study investigates the impact of FDI inflows on R&D activity in 48 developing countries for the 1996-2013 periods. The results based on the system Generalized Method of Moment (GMM) estimator show that FDI inflows discourage R&D activity in developing countries. This finding is consiste...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Faculty of Economics and Management, Universiti Putra Malaysia
2018
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| Online Access: | http://psasir.upm.edu.my/id/eprint/16096/1/16%29%20FDI%20Inflows.pdf http://psasir.upm.edu.my/id/eprint/16096/ http://www.ijem.upm.edu.my/vol12_noS2/16)%20FDI%20Inflows.pdf |
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| Institution: | Universiti Putra Malaysia |
| Language: | English |
| Summary: | This study investigates the impact of FDI inflows on R&D activity in 48 developing countries for the 1996-2013 periods. The results based on the system Generalized Method of Moment (GMM) estimator show that FDI inflows discourage R&D activity in developing countries. This finding is consistent with the view that foreign R&D investment is a substitute for domestic R&D efforts. This suggests that firms in developing countries are more inclined toward imitation of the existing products rather than innovation of a new technology. However, domestic R&D activity appears to benefit from imports of machinery and equipment, stronger legal protections, better human capital and higher economic growth. |
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