Trade, Foreign Investment, and Industrial Policy for Developing Countries*

Harrison, Ann; Rodrı́guez-Clare, Andrés

doi:10.1016/b978-0-444-52944-2.00001-x

Cited by 315 publications

(129 citation statements)

References 302 publications

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“…Most of the existing theoretical literature favors the idea that the entry and production of MNFs contribute positively to the productivity level and growth of host economies, but theoretical and empirical work has not established why this contribution is difficult to identify in cross-country and panel regressions (Harrison and Rodriguez-Clare, 2010). In this paper, I examined two conflicting mechanisms by which multinational production affects the welfare of the host economy when firms are heterogeneous in productivity: contribution to productivity growth due to technology transfer and entry/exit and their effect of aggregate productivity due to the combination of fixed costs of production and sorting of entrants.…”

Section: Discussionmentioning

confidence: 99%

“…Although the evidence has in general been mixed, recent studies, using more sophisticated methodologies and micro-level datasets, find more favorable evidence of benefits from FDI." Similarly, Harrison and Rodriguez-Clare (2010) conclude their review noting that "Nevertheless, there is generally mixed evidence on the relationship between FDI and a country's growth." 1 Researchers who use aggregate data normally postulate that the aggregate 1 See also the survey of Carkovic and Levine (2005).…”

Section: Introductionmentioning

confidence: 99%

“…For example, Arnold and Javorcik (2009) find that foreign ownership leads to significant increases in the productivity of newly acquired affiliates in Indonesia, as well as improvement in every other observable dimension, including higher productivity growth, higher investment, and higher sales growth. Harrison and Rodriguez-Clare (2010) conclude that "Most researchers find that the own-plant effect is large and significant. In other words, firms with foreign equity participation typically have higher output, higher output per worker, or higher levels of TFP " [Total Factor Productivity].…”

Section: Introductionmentioning

confidence: 99%

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Multinational Firms' Entry and Productivity: Some Aggregate Implications of Firm-level Heterogeneity

Contessi¹

2015

gwp

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Despite the microeconomic evidence supporting the superior idiosyncratic productivity of multinational firms (MNFs) and their affiliates, cross-country studies fail to find robust evidence of a positive relationship between foreign direct investment and growth. In order to study the aggregate implications of MNFs entry and production, I develop a dynamic general equilibrium model with firm heterogeneity where MNFs sort according to their own productivity. The entry and production of MNFs contribute to aggregate productivity growth at decreasing rates and affect domestic producers through general equilibrium effects in the labor market. I argue that the heterogeneous composition of the population of affiliates can help explain the conflicting evidence on the impact of foreign direct investment on growth.JEL codes: F21, F23, F41, F42

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Section: Discussionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Multinational Firms' Entry and Productivity: Some Aggregate Implications of Firm-level Heterogeneity

Contessi¹

2015

gwp

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“…As discussed in some detail in TDR 2014, while exporting firms also tend to be the most productive in a sector, microbased empirical evidence indicates that this correlation is primarily driven by selection rather than by the hypothesized causal link from exporting to productivity growth (Harrison and Rodríguez-Clare, 2009;McMillan and Rodrik, 2011;Melitz and Trefler, 2012). That is, more productive firms tend to start exporting; alternatively, opening up to trade simply increases the market share of more productive firms because competition drives less productive domestic firms out of business.…”

Section: B a Preliminary Frameworkmentioning

confidence: 99%

Влияние Внешних Факторов На Развитие Рынка Консалтинговых Услуг

Владимировна¹

2017

Russian Journal of Entrepreneurship

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В статье рассмотрены внешние факторы, оказывающие воздействие на рынок консалтинговых услуг. Сделана их классификация и анализ применительно к текущему развитию рынка управленческого консультирования в России. В результате проведенного анализа констатировано, что к факторам, оказывающим наиболее сильное влияние на рынок консалтинговых услуг, можно отнести: политические; экономические; правовые и законодательные; технологические; социальные, организационные и психологические факторы.

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“…Given the recent resurgence of interest in industrial policy across many developed countries (Aghion et al, 2013;Aiginger, 2007;Block and Keller, 2011;Harrison and Rodríguez-Clare, 2009;Mazzucato, 2011; Rodrik, 2004), there is now substantial policy interest in developing stronger, more 'competitive' digital economies. For example, the UK's new industrial strategy agenda (Cable, 2012) Real-world features of an industry tend to evolve ahead of any given industrial typology.…”

Section: / Introductionmentioning

confidence: 99%

Mapping digital businesses with big data: Some early findings from the UK

Nathan

Rosso

2015

Research Policy

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[144 words]Governments around the world want to develop their ICT industries. Researchers and policymakers thus need a clear picture of digital businesses, but conventional datasets and typologies tend to lag real-world change. We use innovative 'big data' resources to perform an alternative analysis for all active companies in the UK, focusing on ICT-producing firms. Exploiting a combination of observed and modelled variables, we develop a novel 'sector-product' approach and use text mining to provide further detail on key sector-product cells. We find that the ICT production space is around 42% larger than SIC-based estimates, with around 70,000 more companies. We also find ICT employment shares over double the conventional estimates, although this result is more speculative. Our findings are robust to various scope, selection and sample construction challenges. We use our experiences to reflect on the broader pros and cons of frontier data use. JEL 1/ IntroductionThis paper uses novel 'big data' sources to expand our understanding of digital businesses in the UK. We produce alternative counts of ICT-producing firms and set out key descriptive characteristics. We then draw on this experience to critically reflect on some of the opportunities and challenges presented by big data tools and analytics for economic research and policymaking.Information and Communications Technologies (ICTs) -and the 'digital economy' they support -are of enduring interest to researchers and policymakers. Digital sectors and firms are the subject of much analysis both at the organisational level (Bloom et al., 2012;Bresnahan et al., 2002) and in the growth field. Human capital and innovation shape long term economic development (Lucas, 1988; Romer, 1990); high value-added sectors such as ICT make direct contributions to national growth, as well as indirect contributions through spillovers and supply chains (Audretsch and Feldman, 1996;Moretti, 2012).National and local government are thus keen to exploit the growth potential of digital businesses. Given the recent resurgence of interest in industrial policy across many developed countries (Aghion et al., 2013;Aiginger, 2007;Block and Keller, 2011;Harrison and Rodríguez-Clare, 2009;Mazzucato, 2011; Rodrik, 2004), there is now substantial policy interest in developing stronger, more 'competitive' digital economies. For example, the UK's new industrial strategy agenda (Cable, 2012) Real-world features of an industry tend to evolve ahead of any given industrial typology. For researchers, these data challenges present particular barriers to understanding the extent and nature of ICT production, where the pace of change can be very rapid. Data coverage is often imperfect, industry typologies can lack detail, and product categories do not closely align with sector categories. For policymakers, these information gaps feed through into policy gaps, which can limit the ability to design effective interventions. 3To tackle these issues we use an innovative commercial dataset develope...

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Trade, Foreign Investment, and Industrial Policy for Developing Countries*

Cited by 315 publications

References 302 publications

Multinational Firms' Entry and Productivity: Some Aggregate Implications of Firm-level Heterogeneity

Multinational Firms' Entry and Productivity: Some Aggregate Implications of Firm-level Heterogeneity

Влияние Внешних Факторов На Развитие Рынка Консалтинговых Услуг

Mapping digital businesses with big data: Some early findings from the UK

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