Essays On Technological Progress And Economic Growth

Author : Yixiao Zhou
Publisher :
ISBN 13 :
Total Pages : 412 pages
Book Rating : 4.:/5 (953 download)

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Download or read book Essays on Mechanisms of Technological Catch-up and Industrial Upgrading in Economic Development written by Yixiao Zhou and published by . This book was released on 2014 with total page 412 pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis examines the channels and mechanisms of technological catch-up and industrial upgrading in the context of economic development. Technological progress is critical for a country's sustainable growth and for the successful transition of a country from imitation to innovation. Therefore, to clarify the main channels and mechanisms driving the accumulation of knowledge and technologies in an economy contributes to an understanding of the sources of economic growth. The specific aspects of technological catch-up and industrial upgrading covered in the thesis include inter-sectoral industrial upgrading, the intensification of R&D activities, a country's tapping into foreign sources of knowledge, and a country's changing position in the global value chain. In studying these channels and mechanisms, in-depth theoretical discussion and quantitative methods are applied. In terms of theoretical discussion, the thesis covers many issues relating to the factors contributing to technological progress and draws our attention to the key aspects of such progress. In terms of quantitative methods, advanced econometric methods such as Generalized Method of Moments (GMM), the estimator from Kyriazidou (1997), the Heckman two-step estimator, the Tobit and Probit estimators and various instrumental variable estimators are employed to address different econometric issues and data structures in model estimations. The thesis finds evidence of the critical role of institutional quality in promoting the productive use of scarce tertiary human capital, in stimulating the Research and Development (R&D) investment of firms, and in attracting R&D investment in host countries by multinational enterprises. The thesis also reveals the importance of human capital as an essential input to the process of technological catch-up and industrial upgrading. A case study of Chinese manufacturing firms clarifies the determinants of firm-level R&D investment, which helps us understand and predict the prospects for innovation in the Chinese economy. By linking firm-level production and customs datasets, the thesis probes into the important question of how trade participation affects innovation in the context of the Chinese economy, which is an especially interesting case due to the huge contribution from trade to China's growth miracle to date. The findings draw attention to processing trade and suggest that under some circumstances deep and long-term engagement in processing trade may adversely influence the R&D investment and innovation prospect of firms. This point reflects the difficulty of technological catch-up and industrial upgrading in a world where global production sharing continues to deepen. Based on the results of empirical and quantitative analyses, several policy suggestions are proposed. These include (1) enhancing institutional quality to accompany other growth-promoting policies, (2) encouraging individual and household-level investment in human capital, (3) nurturing domestic R&D stock and research talents at relatively early stages of development and (4) looking beyond the direct targets of industrial and trade policies to take into account the implications for technological catch-up and industrial upgrading when making such policies. The thesis also points out some directions for future research to extract from the dynamics of the world economy those channels and mechanisms of technological catch-up and industrial upgrading yet unclarified by this thesis.