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MNEs and Export Spillovers: An Analysis of Indian Manufacturing Industries

Author

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  • Chiara Franco

    (Department of Economics, University of Bologna, Italy)

  • Subash Sasidharan

    (Madras School of Economics)

Abstract

In the present study, we try to provide some empirical evidence for the export spillover effect examining the case of an emerging economy, namely India using firm level data for the period 1994-2006. We disentangle different spillover channels, namely export spillover, R&D spillover and wage spillover. We also consider the heterogeneous technological behaviour of local firms considering how in-house R&D efforts and disembodied technological imports may affect the overall exporting performance. Our findings mainly confirm that the two most important channels for export spillover are mainly the demonstration effect and the R&D spillover effect The decision to export is influenced mainly by technological activities of local firms, confirming that R&D is a key variable that help firms to overcome fixed costs that are crucial to start exporting. Moreover, the findings of the analysis suggest that local firms’ R&D is highly relevant to internalize the positive spillover effect emanating from MNEs both with regard to decision to export and export propensity

Suggested Citation

  • Chiara Franco & Subash Sasidharan, 2009. "MNEs and Export Spillovers: An Analysis of Indian Manufacturing Industries," Working Papers 2009-049, Madras School of Economics,Chennai,India.
    • Handle: RePEc:mad:wpaper:2009-049
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    Cited by:

    1. 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.
    2. 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.

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    More about this item

    Keywords

    Exports; FDI spillover; MNEs;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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