Title: Industrial upgrading with shifting resource toward external information sources

Authors: Tomohiro Machikita; Masatsugu Tsuji; Yasushi Ueki

Addresses: Institute of Developing Economies, Japan External Trade Organization (IDE-JETRO), 3-2-2, Wakaba, Mihama, Chiba, 2618545, Japan ' Faculty of Economics, Kobe International University, 9-1-6 Koyocho-naka, Higashinada-ku, Kobe, 658-0032, Japan ' Economic Research Institute for ASEAN and East Asia (ERIA), Sentral Senayan II 6th Floor, Jl. Asia Afrika No.8. Gelora Bung Karno, Senayan, Jakarta Pusat 10270, Indonesia

Abstract: Using data from an original and unique firm-level survey conducted in Southeast Asia, this paper examines the impacts of shifting from exploiting internal resources to exploring external information sources on product innovations and engaging foreign market for firms in emerging economies. This paper explores how the impacts of a shift toward external links vary across knowledge resources from trade and non-trade partners as well as across domestic and international partners. We also present findings regarding how the impacts of shifting to exploring external information sources vary between local firms and foreign affiliates. A 10% shift in resource allocation from internal resources to external links can generate a 1.4 percentage point increase in the likelihood of costly product innovation as well as a 1.9-3.8 percentage point increase in the probability of foreign market participation.

Keywords: technology transfers; Southeast Asia.

DOI: 10.1504/IJTG.2017.089001

International Journal of Technology and Globalisation, 2017 Vol.8 No.2, pp.141 - 168

Accepted: 20 Jun 2017
Published online: 03 Jan 2018 *