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Foreign Ownership, Technological Intensities and Economic Performance of Automotive Parts Firms in India

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  • RAJAH RASIAH
  • ASHISH KUMAR

Abstract

This contribution examines differences in technological intensities between foreign and local automotive parts firms in India. Foreign firms enjoyed higher labour productivity, wages, and export, technological and skills intensities than local firms. The econometric results showed a strong relationship between labour productivity and technological intensity. The technological intensity variable (including its components of human resource, process technology and R&D) was also strongly and positively correlated with skills intensity. Foreign ownership was only statistically significant and positive in the human resources regressions. Local firms also showed statistically significant levels of technological intensity (especially in process technology) when competing in export markets, suggesting that foreign firms may offer a competitive and complementary presence to spur local firms' development.

Suggested Citation

  • Rajah Rasiah & Ashish Kumar, 2008. "Foreign Ownership, Technological Intensities and Economic Performance of Automotive Parts Firms in India," Asia Pacific Business Review, Taylor & Francis Journals, vol. 14(1), pages 85-102.
    • Handle: RePEc:taf:apbizr:v:14:y:2008:i:1:p:85-102
    DOI: 10.1080/13602380701661036
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    Cited by:

    1. Keshari, Pradeep Kumar, 2013. "Comparative performance of foreign affiliates and domestic firms in the Indian machinery industry," MPRA Paper 33076, University Library of Munich, Germany, revised 20 Apr 2013.
    2. Jaya Prakash Pradhan & Neelam Singh, 2009. "Outward FDI and Knowledge Flows: A Study of the Indian Automotive Sector," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 1(1), pages 156-187, June.
    3. Keshari, Pradeep Kumar, 2012. "FDI and firm level export competitiveness in the Indian machinery industry," MPRA Paper 47069, University Library of Munich, Germany.
    4. Krishan SINGH & Sandeep Kaur BHATIA, 2017. "Whether Fdi Or Exports Enhance Innovation: Evidence From Indian Manufacturing Firms, 2001-2012," Revista Galega de Economía, University of Santiago de Compostela. Faculty of Economics and Business., vol. 26(3), pages 19-32.
    5. Ali Shaddady & Faisal Alnori, 2020. "Do Ownership Structure, Political Connections and Executive Compensation Have Multifaceted Effects on Firm Performance? An Alternative Approach," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 12(10), pages 1-22, October.
    6. Ahmed Fayez Abdelgouad & Christian Pfeifer & John P Weche Gelübcke, 2015. "Ownership structure and firm performance in the Egyptian manufacturing sector," Economics Bulletin, AccessEcon, vol. 35(4), pages 2197-2212.

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