There are several arguments in the literature regarding that more open economies
would grow faster in the long term. Nevertheless, the channels through which
openness increases growth have not been clearly identified in empirical analysis.
In this article, we study if outward orientation variables have a positive impact
on technological innovation, which is one of the most important sources of productivity
growth. Using microeconomic data for Chilean manufacturing industry,
we identify the effect of three main mechanisms of technological absorption:
exports, direct foreign investment and purchase of foreign technical licenses. The
results suggest that exports increase significantly technological innovation. In
addition, we found causality in both ways. Technological innovation increases
the probability of exporting. The other two channels; direct foreign investment
and technical licenses, would be less important, because they only affect a reduced
number of technological innovation indicators.
Alvarez, R. (2016). External sources of techonological innovation in Chilean manufacturating industry. Estudios De Economía, 28(1), pp. 53–68. Retrieved from https://estudiosdeeconomia.uchile.cl/index.php/EDE/article/view/40786
