1、一、外文原文Foreign direct investment and Technology Spillover: A Cross-industry Analysis of Thai ManufacturingImportance of the issueForeign direct investment (FDI) has been widely recognized as a growth-enhancing factor in investment receiving (host) countries. FDI not only brings in capital but also in
2、troduces advanced technology that can enhance the technological capability of the host country firms, thereby generating long-term and sustainable economic growth. More importantly, the technological benefit is not limited to locally affiliated firms but can also spread to non-affiliated ones. The l
3、atter benefit is usually referred to as technology spillover.The expectation of gaining from technology spillover persuades many developing countries to offer various incentives in order to attract FDI. However the results of empirical research to test the validity of technology spillover are far fr
4、om conclusive. Positive technology spillover from FDI has only been found in some countries.1 Overall, the findings seem to suggest technology spillover is not automatic, but depends on both country specific factors and policy environment.Foreign Presence in Thai ManufacturingThirdly, foreign plants
5、 are likely to be located in a highly protected industry. The average ERP2 of industries whose output shares of foreign plants are greater than 50% is 15.3%. The exception in these industries would be electrical machinery which is presumably dominated by labor-intensive assembled electronics and ele
6、ctrical appliances. On the other hand, regarding the industries where the share of foreign plants is less than 50%, average ERP tends to be lower at around 10.8%. In addition, the output share of foreign plants is likely to be associated with the degree of market concentration.Involvement of foreign
7、 plants in the manufacturing sector was predominately in import substituting industries such as textiles, automobiles, and chemicals up to about the late 1970s (Akira, 1989). From then on, it was directed to more export-oriented activities. To begin with, export-oriented foreign firms entered light
8、manufacturing industries such as clothing, footwear, and toys. More recently, labor-intensive assembly activities in electronics and electrical goods industries have been the main attraction for foreign investors (Kohpaiboon, 2005).Such involvement has closely mirrored the shift in the trade policy
9、regime. Thailand began its first national economic development plan in 1961 with an import substitution (IS) regime to promote industrialization. Tariffs were the major instrument used to influence the countrys development path. The role of tariffs to promote the domestic industry effectively began
10、in 1974 with the imposition of an escalating tariff structure, where the tariff rate ascended from raw materials to finished products. These changes increasingly favored the production of finished products, particularly consumer products. In 1975, the range of the effective rate of protection (ERP)
11、in the Thai manufacturing sector was between 36 to 350% (Akrasanee & Ajanant, 1986). In 1982, the variation widened from 25.2 to 1,693.4% (Chunanantathum et al. 1984). Several industries, such as textiles, tyres, furniture, automobiles, and leather products, had an extremely high ERP. There was also
12、 a high degree of variation in ERP across industries. This tariff structure remained virtually unchanged until the late 1980s, even though in 1974 the government announced a change in development strategy to an export promotion (EP) regime.Significant tariff reductions commenced in 1988, starting wi
13、th electrical and electronic goods as well as with the inputs into these products. Comprehensive packages of tariff reform were implemented in 1995 and 1997. It involved tariff reduction and rationalization. Maximum tariffs were reduced from 100% in the early 1990s to 30%. By the end of the 1990s, t
14、he tariff bands were reduced from 39 to 6 tariff rates (0, 1, 5, 10, 20 and 30%). The two low rates (0 and 1%) were for raw materials and the two top rates (20 and 30%) for finished products with the two middle rates for intermediate goods. In addition, tariff restructuring has received renewed emph
15、asis as an essential part of the overall economic reforms aimed at strengthening efficiency and competitiveness over the past two years. The Thai government introduced another effort to lower tariff rates, commencing in June 2003 (implemented in October 2003), followed by a fouryear period of tariff
16、 reduction from 2004 to 2008. There are around 900 items involved in the second round of tariff reductions, covering a wide range of manufacturing products. The tariff reduction in this round is mainly on intermediate products, thereby maintaining the escalating tariff structure. The magnitude of ta
17、riff reduction is moderate, within the range of 0 to 8.9% (Athukorala et al. 2004).As a result, average tariffs declined markedly from 30.2% in 1990 to 21.3% in 1995 and further to 11% in 2005. The dispersion of ERP also narrowed over the periods across industries. In 2003, the ERP range reduced to
18、-27.1 to 142% (Athukorala et al. 2004).4 The changes in the tariff structure would have significantly improved the incentive to attract FDI to industries where Thailand has a comparative advantage in international production.Analytical FrameworkTechnology spillover from FDI is said to take place whe
19、n the presence of a foreign firm generates productivity or efficiency benefits for the host countrys local non-affiliated firms (Blomstrm & Kokko,1998). As mentioned, technology spillover from FDI is not automatic but rather conditioned on the nature of the trade policy regime across industries. A t
20、heoretical framework for examining the effect of the trade policy regime on the gains from FDI in a given host country was first presented by Bhagwati (1973) as an extension to his theory of immiserizing growth. It was further developed by Bhagwati (1985, 1994); Brecher & Diaz-Alejandro (1977); and
21、Brecher & Findlay (1983). A key hypothesis arising from this literature is that technology spillover tends to be smaller, or possibly even negative, under a restrictive, import substitution (IS) regime compared with a liberalizing, export promotion (EP) regime.To illustrate how technology spillover
22、takes place as well as how the trade policy regime across industries can alter the magnitude of these spillovers as suggested by Bhagwati (1973), we use the theoretical model developed by Wang & Blomstrm (1992). In the model, there are two firms, namely an affiliate of a multinational enterprise (MN
23、E) and a local non-affiliated firm (henceforth referred to as the foreign and local firms, respectively), producing differentiated but substitutable products for the host country market. Technology spillover is an outcome of interaction of these two firms. On the one hand, the entry of a foreign fir
24、m is always associated with some amount of proprietary technology from the parent company so as to offset the potential disadvantage against the local firm possessing superior knowledge of the availability of factor inputs, business practices and/or consumer preferences in the host country. In addit
25、ion, advanced technology would help the foreign firm to gain market share in the host country. However transferring technology from MNEs headquarter to its affiliates are costly. The more the advance level of technology transferred, the larger the dollar costs associated with the transfer.Because of
26、 the presence of cost and benefit, the foreign firm has to decide the effort of undertaking technology transferred from its headquarter to maximize its net benefit. Such effort would depend on the local firms response to the presence of the foreign firm. In a situation where the local firm actively
27、puts in the effort to learn the advanced technology associated with the foreign firm, the technology superiority of the latter will not last long. As the result, it will need to keep undertaking technology transfer activities in the following period in order to maintain the advantage or even to just
28、 survive in the host country environment. In contrast, a situation where the local firm is less responsive in attempting to learn the associated technology provides relatively less incentive for the foreign firm to continue to actively undertake technology transfers from its parent company.On the ot
29、her hand, the local firm can observe, learn, and adapt superior technology associated with the foreign firm to enhance its own technological capability. This is because the technology accompanied with the foreign firm has certain public good qualities, which cannot be fully internalized, thus the lo
30、calization of the foreign firm could potentially generate positive externality in terms of technological benefit to the local firm. Since the market success of each firm depends on the level of technology it employs, this encourages the local firm to learn the associated superior technology. Neverth
31、eless, the effort of learning and adapting the associated technology is associated with the dollar amount of cost so that the local firm has to decide its effort to learn associated advanced technology. Similar to the foreign firm, the learning effort of the local firm also depends on the foreign fi
32、rm behavior.To incorporate the Bhagwati hypothesis, the model discussed above is modified by hypothesizing that the trade policy regime influences the cost effectiveness in the learning activities of the local firm. That is, every effort to enhance the technological capability of the local firm is m
33、ore costly in any industry where the trade regime is more restrictive. This is because much of the FDI flowing to an industry with high trade restrictions often enters relatively capital- and skill-intensive products where output is mainly supplied for a highly protected domestic market. Although the production
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