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COMPLEMENTARITY BETWEEN LOCAL KNOWLEDGE AND INTERNATIONALIZATION IN REGIONAL TECHNOLOGICAL PROGRESS *
Author(s) -
LópezBazo Enrique,
Requena Francisco,
Serrano Guadalupe
Publication year - 2006
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.2006.00490.x
Subject(s) - complementarity (molecular biology) , internationalization , total factor productivity , foreign direct investment , economic geography , economics , international trade , productivity , international economics , business , economic growth , macroeconomics , genetics , biology
Trade, foreign direct investment, and inter‐regional R&D spillovers facilitate competition, the spread of knowledge, and the adoption of more advanced technologies, which in turn hastens total factor productivity (TFP) growth. The spread of these efficiency gains from internationalization requires a sufficient local knowledge to enable them to be adapted to the domestic productive environment. Thus, higher local knowledge and internationalization will lead to TFP growth, and the greater the complementarity between variables the higher the TFP growth. We test the complementarity hypothesis using Spanish regional data over the period 1980–1995 in which both regional local knowledge and internationalization experienced a notable increase.