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Publication
Technological innovation in New European Union Markets
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Advisor(s)
Abstract(s)
We analyze the role of innovation in the technological development of four new EU members: the Czech Republic, Hungary, Poland and Slovakia. For that purpose, we use a novel approach by modeling the empirical relationship between intra-industrial bilateral trade flows, which proxy the level of technological progress, and innovation expenditures within the context of a gravity model with a set of appropriate instrumental variables to account for the potential endogeneity of innovation to trade. We show that innovation efforts in high-tech industries exhibit a strong effect on the technological progress of the region and they are closely linked to foreign direct investment and multinationals. As foreign-owned subsidiaries become a part of the innovation systems and industrial structure of the host country they promote overall technological growth in the region.
Description
Keywords
Foreign Direct Investment Innovation Imitation International Trade European Union
Pedagogical Context
Citation
Uzagalieva, Ainura; Kočenda, Evžen; Menezes, António Gomes (2012). Technological innovation in New European Union Markets, “Working Paper Series”, nº 1/12, 23 pp.. Ponta Delgada: Universidade dos Açores, CEEAplA-A.