IDEAS home Printed from https://ideas.repec.org/a/ebl/ecbull/eb-12-00058.html
   My bibliography  Save this article

Foreign direct investment and productivity spillovers: Empirical evidence from Cambodia

Author

Listed:
  • Savuth Cheng

    (Nagoya University, Graduate School of Economics)

Abstract

This paper investigates productivity spillovers from Foreign Direct Investment (FDI) to the host country. By using firm-level data from Cambodia and by regressing domestic firms' total factor productivity (TFP) and labor productivity on FDI, the study reveals that domestic firms significantly benefit from productivity spillovers when their level of technology is moderately below that of foreign competitors. The finding suggests that promoting FDI in Cambodia is needed when the technology gap exists.

Suggested Citation

  • Savuth Cheng, 2012. "Foreign direct investment and productivity spillovers: Empirical evidence from Cambodia," Economics Bulletin, AccessEcon, vol. 32(3), pages 2015-2025.
    • Handle: RePEc:ebl:ecbull:eb-12-00058
    as

    Download full text from publisher

    File URL: http://www.accessecon.com/Pubs/EB/2012/Volume32/EB-12-V32-I3-P195.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sourafel Girma & Holger Görg & Mauro Pisu, 2016. "Exporting, linkages and productivity spillovers from foreign direct investment," World Scientific Book Chapters, in: MULTINATIONAL ENTERPRISES AND HOST COUNTRY DEVELOPMENT Volume 53: World Scientific Studies in International Economics, chapter 10, pages 191-211, World Scientific Publishing Co. Pte. Ltd..
    2. Ronald Findlay, 1978. "Relative Backwardness, Direct Foreign Investment, and the Transfer of Technology: A Simple Dynamic Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 92(1), pages 1-16.
    3. Cameron,A. Colin & Trivedi,Pravin K., 2005. "Microeconometrics," Cambridge Books, Cambridge University Press, number 9780521848053, October.
    4. CUYVERS, Ludo & SOENG, Reth & PLASMANS, Joseph & VAN DEN BULCKE, Daniël, 2008. "Productivity spillovers from foreign direct investment in the Cambodian manufacturing sector: Evidence from establishment-level data," Working Papers 2008004, University of Antwerp, Faculty of Business and Economics.
    5. Salvador Barrios & Eric Strobl, 2002. "Foreign direct investment and productivity spillovers: Evidence from the Spanish experience," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 138(3), pages 459-481, September.
    6. Rachel Griffith & Stephen Redding & John Van Reenen, 2004. "Mapping the Two Faces of R&D: Productivity Growth in a Panel of OECD Industries," The Review of Economics and Statistics, MIT Press, vol. 86(4), pages 883-895, November.
    7. Davide Castellani & Antonello Zanfei, 2003. "Technology gaps, absorptive capacity and the impact of inward investments on productivity of European firms ," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 12(6), pages 555-576.
    8. Amil Petrin & Brian P. Poi & James Levinsohn, 2004. "Production function estimation in Stata using inputs to control for unobservables," Stata Journal, StataCorp LP, vol. 4(2), pages 113-123, June.
    9. Blalock, Garrick & Gertler, Paul J., 2009. "How firm capabilities affect who benefits from foreign technology," Journal of Development Economics, Elsevier, vol. 90(2), pages 192-199, November.
    10. Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-596, September.
    11. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
    12. Sophia Dimelis & Helen Louri, 2004. "Foreign direct investment and technology spillovers: Which firms really benefit?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 140(2), pages 230-253, June.
    13. Glass, Amy Jocelyn & Saggi, Kamal, 1998. "International technology transfer and the technology gap," Journal of Development Economics, Elsevier, vol. 55(2), pages 369-398, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Moralles, Herick Fernando & Moreno, Rosina, 2020. "FDI productivity spillovers and absorptive capacity in Brazilian firms: A threshold regression analysis," International Review of Economics & Finance, Elsevier, vol. 70(C), pages 257-272.
    2. Peng, Fei & Peng, Langchuan & Wang, Zheng, 2021. "How do VAT reforms in the service sectors impact TFP in the manufacturing sector: Firm-level evidence from China," Economic Modelling, Elsevier, vol. 99(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Neil Foster-McGregor, 2012. "Innovation and Technology Transfer across Countries," wiiw Research Reports 380, The Vienna Institute for International Economic Studies, wiiw.
    2. Seyoum, Mebratu & Wu, Renshui & Yang, Li, 2015. "Technology spillovers from Chinese outward direct investment: The case of Ethiopia," China Economic Review, Elsevier, vol. 33(C), pages 35-49.
    3. Muhammed BENLI, 2016. "Productivity spillovers from FDI in Turkey: Evidence from quantile regressions," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(3(608), A), pages 177-196, Autumn.
    4. Muhammed BENLI, 2016. "Productivity spillovers from FDI in Turkey: Evidence from quantile regressions," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(608), A), pages 177-196, Autumn.
    5. Fernando Ubeda & Francisco Pérez-Hernández, 2017. "Absorptive Capacity and Geographical Distance Two Mediating Factors of FDI Spillovers: a Threshold Regression Analysis for Spanish Firms," Journal of Industry, Competition and Trade, Springer, vol. 17(1), pages 1-28, March.
    6. Noor Aini Khalifah & Salmah Mohd Salleh & Radziah Adam, 2015. "FDI productivity spillovers and the technology gap in Malaysia's electrical and electronic industries," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 29(1), pages 142-160, May.
    7. Mariotti, Sergio & Nicolini, Marcella & Piscitello, Lucia, 2013. "Vertical linkages between foreign MNEs in service sectors and local manufacturing firms," Structural Change and Economic Dynamics, Elsevier, vol. 25(C), pages 133-145.
    8. Peng Li & Yaofu Ouyang, 2020. "Technical Change and Green Productivity," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 76(2), pages 271-298, July.
    9. Muhammed BENLI, 2016. "FDI and export spillovers using Heckman’s two step approach: Evidence from Turkish manufacturing data," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(4(609), W), pages 315-342, Winter.
    10. Seda Köymen Özer & Selin Sayek Böke, 2017. "The Characteristics of Domestic Firms: Materializing Productivity Spillovers from FDI," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 53(11), pages 2562-2584, November.
    11. Muhammed BENLI, 2016. "FDI and export spillovers using Heckman’s two step approach: Evidence from Turkish manufacturing data," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(4(609), W), pages 315-342, Winter.
    12. Farole, Thomas & Winkler, Deborah, 2012. "Foreign firm characteristics, absorptive capacity and the institutional framework : the role of mediating factors for FDI spillovers in low- and middle-income countries," Policy Research Working Paper Series 6265, The World Bank.
    13. Marijke J. D. Bos & Gonzague Vannoorenberghe, 2018. "Total factor productivity spillovers from trade reforms in India," Canadian Journal of Economics, Canadian Economics Association, vol. 51(2), pages 549-606, May.
    14. Di Ubaldo, Mattia & Lawless, Martina & Siedschlag, Iulia, 2018. "Productivity spillovers from multinational activity to indigenous firms in Ireland," Papers WP587, Economic and Social Research Institute (ESRI).
    15. Bin Ni & Hayato Kato, 2020. "Do vertical spillovers differ by investors’ productivity? Theory and evidence from Vietnam," Review of Development Economics, Wiley Blackwell, vol. 24(3), pages 1046-1072, August.
    16. Benzaim, Samia & Ftiti, Zied & Khedhaouria, Anis & Djermane, Rebai, 2023. "US foreign investments: Technology transfer, relative backwardness, and the productivity growth of host countries," The Quarterly Review of Economics and Finance, Elsevier, vol. 87(C), pages 275-295.
    17. Martin Bijsterbosch & Marcin Kolasa, 2010. "FDI and productivity convergence in Central and Eastern Europe: an industry-level investigation," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(4), pages 689-712, January.
    18. Yoshimichi Murakami & Keijiro Otsuka, 2017. "A Review of the Literature on Productivity Impacts of Global Value Chains and Foreign Direct Investment: Towards an Integrated Approach," Discussion Paper Series DP2017-19, Research Institute for Economics & Business Administration, Kobe University, revised Aug 2019.
    19. Peri, Giovanni & Urban, Dieter, 2006. "Catching-up to foreign technology? Evidence on the "Veblen-Gerschenkron" effect of foreign investments," Regional Science and Urban Economics, Elsevier, vol. 36(1), pages 72-98, January.
    20. Naijela Janaina Costa Silveira & Diogo Ferraz & Eduardo Polloni‐Silva & Diego Scarpa de Mello & Fernanda Pereira Sartori Falguera & Herick Fernando Moralles, 2022. "Modeling the building blocks of country‐level absorptive capacity: Comparing developed and emergent economies," Bulletin of Economic Research, Wiley Blackwell, vol. 74(3), pages 783-824, July.

    More about this item

    Keywords

    FDI; Cambodia; Productivity; Spillovers; Technology Gap; Absorptive Capacity;
    All these keywords.

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-12-00058. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: John P. Conley (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.