IDEAS home Printed from https://ideas.repec.org/a/taf/apbizr/v14y2008i1p85-102.html
   My bibliography  Save this article

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

Author

Listed:
  • 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
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/13602380701661036
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/13602380701661036?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ganeshan Wignaraja, 2002. "Firm Size, Technological Capabilities and Market-oriented Policies in Mauritius," Oxford Development Studies, Taylor & Francis Journals, vol. 30(1), pages 87-104.
    2. Aitken, Brian & Hanson, Gordon H. & Harrison, Ann E., 1997. "Spillovers, foreign investment, and export behavior," Journal of International Economics, Elsevier, vol. 43(1-2), pages 103-132, August.
    3. Brian J. Aitken & Ann E. Harrison, 2022. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 6, pages 139-152, World Scientific Publishing Co. Pte. Ltd..
    4. Magnus Blomström & Ari Kokko & Mario Zejan, 2000. "Multinational Corporations and Spillovers," Palgrave Macmillan Books, in: Foreign Direct Investment, chapter 8, pages 101-133, Palgrave Macmillan.
    5. Blomstrom, Magnus & Sjoholm, Fredrik, 1999. "Technology transfer and spillovers: Does local participation with multinationals matter?1," European Economic Review, Elsevier, vol. 43(4-6), pages 915-923, April.
    6. Lall, Sanjaya, 1992. "Technological capabilities and industrialization," World Development, Elsevier, vol. 20(2), pages 165-186, February.
    7. Vinish Kathuria, 2002. "Liberalisation, FDI, and productivity spillovers--an analysis of Indian manufacturing firms," Oxford Economic Papers, Oxford University Press, vol. 54(4), pages 688-718, October.
    8. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    9. Vinish Kathuria, 2000. "Productivity spillovers from technology transfer to Indian manufacturing firms," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(3), pages 343-369, April.
    10. Figueiredo, Paulo N., 2002. "Does technological learning pay off? Inter-firm differences in technological capability-accumulation paths and operational performance improvement," Research Policy, Elsevier, vol. 31(1), pages 73-94, January.
    11. Rajah Rasiah, 2004. "Technological intensities in East and Southeast Asian electronics firms: Does network strength matter?," Oxford Development Studies, Taylor & Francis Journals, vol. 32(3), pages 433-455.
    12. Haddad, Mona & Harrison, Ann, 1993. "Are there positive spillovers from direct foreign investment? : Evidence from panel data for Morocco," Journal of Development Economics, Elsevier, vol. 42(1), pages 51-74, October.
    13. repec:bla:jecsur:v:12:y:1998:i:3:p:247-77 is not listed on IDEAS
    14. Vinish Kathuria, 2001. "Foreign firms, technology transfer and knowledge spillovers to Indian manufacturing firms: a stochastic frontier analysis," Applied Economics, Taylor & Francis Journals, vol. 33(5), pages 625-642.
    15. Vaitsos, Constantine V., 2003. "Growth Theories Revisited: Enduring Questions with Changing Answers," UNU-INTECH Discussion Paper Series 2003-09, United Nations University - INTECH.
    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. 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.

    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. Rasiah, Rajah, 2004. "Technological Intensity and Export Incidence: A Study of Foreign and Local Auto-Parts, Electronics and Garment Firms in Indonesia," UNU-INTECH Discussion Paper Series 2004-05, United Nations University - INTECH.
    3. Crespo, Nuno & Fontoura, Maria Paula, 2007. "Determinant Factors of FDI Spillovers - What Do We Really Know?," World Development, Elsevier, vol. 35(3), pages 410-425, March.
    4. Geoffrey G. Gachino, 2010. "Technological spillovers from multinational presence," Progress in Development Studies, , vol. 10(3), pages 193-210, July.
    5. Klaus E Meyer & Evis Sinani, 2009. "When and where does foreign direct investment generate positive spillovers? A meta-analysis," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 40(7), pages 1075-1094, September.
    6. Binyam A. Demena & Peter A. G. van Bergeijk, 2017. "A Meta-Analysis Of Fdi And Productivity Spillovers In Developing Countries," Journal of Economic Surveys, Wiley Blackwell, vol. 31(2), pages 546-571, April.
    7. Marin, Anabel & Sasidharan, Subash, 2010. "Heterogeneous MNC subsidiaries and technological spillovers: Explaining positive and negative effects in India," Research Policy, Elsevier, vol. 39(9), pages 1227-1241, November.
    8. Rasiah, Rajah & Tamale, Henry, 2004. "Productivity, Exports, Skills and Technological Capabilities: A Study of Foreign and Local Manufacturing Firms in Uganda," UNU-INTECH Discussion Paper Series 2004-01, United Nations University - INTECH.
    9. Mico Apostolov, 2016. "Cobb–Douglas production function on FDI in Southeast Europe," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 5(1), pages 1-28, December.
    10. Tomáš Havránek & Zuzana Iršová, 2010. "Meta-Analysis of Intra-Industry FDI Spillovers: Updated Evidence," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 60(2), pages 151-174, May.
    11. Greenaway, David & Görg, Holger, 2002. "Much Ado About Nothing? Do Domestic Firms Really Benefit from Foreign Investment?," CEPR Discussion Papers 3485, C.E.P.R. Discussion Papers.
    12. Subash Sasidharan, 2006. "Foreign Direct Investment and Technology Spillovers:Evidence from the Indian Manufacturing Sector," Working Papers id:448, eSocialSciences.
    13. Christian Bellak, 2004. "How Domestic and Foreign Firms Differ and Why Does it Matter?," Journal of Economic Surveys, Wiley Blackwell, vol. 18(4), pages 483-514, September.
    14. Pedro Sánchez-Sellero & Jorge Rosell-Martínez & José Manuel García-Vázquez, 2014. "Spillovers from Foreign Direct Investment in Spanish Manufacturing Firms," Review of International Economics, Wiley Blackwell, vol. 22(2), pages 342-351, May.
    15. Harpreet Dusanjh & A.S. Sidhu, 2009. "Multi-spillover Effects of Multinational Corporations on Host Countries," Global Business Review, International Management Institute, vol. 10(2), pages 243-260, July.
    16. Trevor Buck & Xiaohui Liu & Yingqi Wei & Xiaming Liu, 2007. "The trade development path and export spillovers in China: A missing link?," Management International Review, Springer, vol. 47(5), pages 683-706, September.
    17. Mühlen, Henning, 2013. "Firm-Level Productivity Spillovers from FDI in Latin American Countries," IEE Working Papers 196, Ruhr University Bochum, Institute of Development Research and Development Policy (IEE).
    18. Holger Görg & David Greenaway, 2016. "Much Ado about Nothing? Do Domestic Firms Really Benefit from Foreign Direct Investment?," World Scientific Book Chapters, in: MULTINATIONAL ENTERPRISES AND HOST COUNTRY DEVELOPMENT Volume 53: World Scientific Studies in International Economics, chapter 9, pages 163-189, World Scientific Publishing Co. Pte. Ltd..
    19. repec:lic:licosd:15605 is not listed on IDEAS
    20. Rasiah, Rajah, 2003. "Foreign ownership, technology and electronics exports from Malaysia and Thailand," Journal of Asian Economics, Elsevier, vol. 14(5), pages 785-811, October.
    21. Gachino, Geoffrey, 2007. "Technological spillovers from multinational presence - Towards a conceptual framework," MERIT Working Papers 2007-017, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

    More about this item

    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:taf:apbizr:v:14:y:2008:i:1:p:85-102. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/FAPB20 .

    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.