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Foreign direct investment, absorptive capacity and technological innovation: empirical evidence in developing economies


Citation

Mohamad, Asuantri and Mhd Bani, Nor Yasmin (2017) Foreign direct investment, absorptive capacity and technological innovation: empirical evidence in developing economies. In: Global Conference on Business and Economics Research (GCBER) 2017, 14-15 Aug. 2017, Universiti Putra Malaysia, Serdang, Selangor. (pp. 72-78).

Abstract

This study investigates the impact of high inflows of FDI and absorptive capacity on technological innovations in developing economies. Utilizing panel data from 1997-2014 for a sample of 39 developing countries and applying the System-GMM estimator, we reached important conclusions. The estimated results show that FDI and absorptive capacity do not have significant effect on technological innovation when estimated separately. However, the effect changes when we consider the interaction of the variables. This indicates that FDI inflows induce technological innovation in the country with an adequate level of absorptive capacity. The results also imply that both FDI inflows and absorptive capacity are necessary in order to increase technological innovations in the host developing countries.


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Additional Metadata

Item Type: Conference or Workshop Item (Paper)
Divisions: Faculty of Economics and Management
Publisher: Faculty of Economics and Management, Universiti Putra Malaysia
Keywords: FDI; Absorptive capacity; Technological innovations; System-GMM
Depositing User: Nabilah Mustapa
Date Deposited: 29 Jan 2018 09:38
Last Modified: 29 Jan 2018 09:38
URI: http://psasir.upm.edu.my/id/eprint/58696
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