Where do foreign direct investment-related technology spillovers come from in emerging economies? An exploration in Argentina in the 1990s

Bell, Martin and Marin, Anabel (2004) Where do foreign direct investment-related technology spillovers come from in emerging economies? An exploration in Argentina in the 1990s. European Journal of Development Research, 16 (3). pp. 653-686. ISSN 0957-8811

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Abstract

Models underlying most research about foreign direct investment (FDI)-related spillovers suggest they originate in the centrally accumulated knowledge assets of multinational corporations (MNCs). From there a one-way 'pipeline' runs via a) international technology transfer to subsidiaries, b) 'leaks' into the host economy, c) varying degrees of absorption by domestic firms to d) those firms' productivity increases. We argue that this gives inadequate attention to knowledgecreating activities by MNC subsidiaries and domestic firms inside the host economy. These co-located and interacting activities are increasingly evident in knowledge-rich locations in advanced economies, reflecting location-specific advantages. We suggest here that such locally rooted and co-located knowledge creation may also lie between, but not necessarily causally connect, FDI and domestic firms' productivity growth in intermediate economies – as illustrated by the case of Argentina in the mid 1990s. Wider questions about policy are noted, with implications for future research highlighted.

Item Type: Article
Additional Information: This paper challenges conventional orthodoxy about the source of technology spillovers from FDI in countries like Argentina, showing the local contribution to be far more significant than the crude `spillovers¿ notion of new growth theorists suggests, in cases where the take-up is successful. Bell contributed more of the writing and drafting of the joint paper.
Schools and Departments: School of Business, Management and Economics > SPRU - Science Policy Research Unit
Depositing User: Martin Bell
Date Deposited: 06 Feb 2012 20:50
Last Modified: 04 Apr 2012 10:59
URI: http://sro.sussex.ac.uk/id/eprint/28417
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