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Doing R&D and Importing Technology : an Empirical Investigation on Taiwan’s manufacturing firms

Author

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  • Chia Lin, CHANG

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

  • Stephane, ROBIN

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and CRESGE-LABORES-France)

Abstract

The objective of this paper is to identify the determinants of the decision to innovate in Taiwan. Three “innovation strategies” are considered : doing R&D only, importing technology only, and combining both. We estimate a Bivariate Probit on a panel of more than 27000 Taiwanese manufacturing firms observed from 1992 to 1995. Results suggest that the decision to R&D over the period was influenced by the prior changes in exportations at the industry level, whereas the decision to import technology is affected by the current changes. We identify a non-linear relationship between firm size and innovation. Moreover, older firms tend to innovate less, whereas market structure doesn’t affect the decision to innovate. These two results change when only high-tech industries are considered : the effect of firm’s age becomes insignificant, whereas a more concentrated market structure is shown to increase the probability to innovate.

Suggested Citation

  • Chia Lin, CHANG & Stephane, ROBIN, 2004. "Doing R&D and Importing Technology : an Empirical Investigation on Taiwan’s manufacturing firms," LIDAM Discussion Papers IRES 2004006, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2004006
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    References listed on IDEAS

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    More about this item

    Keywords

    R&D; importation of technology; market structure; technological opportunities; high-tech industries; panel data; bivariate Probit.;
    All these keywords.

    JEL classification:

    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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