Foreign Direct Investment and Technology Spillover: A Cross-Industry Analysis of Thai Manufacturing

Archanun Kohpaiboon

    Research output: Contribution to journalArticle

    Abstract

    This paper examines technology spillover from foreign direct investment (FDI) based on a cross-industry analysis of Thai manufacturing. The analysis is built around the hypothesis by Bhagwati that technology spillover is conditioned by the nature of the trade policy regime. The result, based on a two-equation model that allows for the two-way link between the foreign presence and productivity of locally owned industries, provides support for the hypothesis. A key policy implication is that liberalizing the foreign investment regime has to go hand in hand with liberalizing the trade policy regime to maximize gains from FDI technology spillover.
    Original languageEnglish
    Pages (from-to)541-556
    JournalWorld Development
    Volume34
    Issue number3
    DOIs
    Publication statusPublished - 2006

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