Date of Original Version

9-2006

Type

Article

Abstract or Description

We present evidence that importing is a source of international technology transfer. Using a detailed panel of Indonesian manufacturers, our analysis shows that firms in industries supplying increasingly import-intensive sectors have higher productivity growth than other firms. This finding suggests that linkages through vertical supply relationships are the channel through which import-driven technology transfer occurs. To our knowledge, these are the first firm-level results showing that downstream imports play a role in productivity gains. Together with the literature linking FDI and exporting to technology spillovers, the results provide a third component to the argument that trade and openness promote economic growth.

DOI

10.1016/j.worlddev.2006.10.009

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Engineering Commons

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Published In

World Development, 35, 7, 1134-1151.