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Title:The effect of technological innovation on international trade PDF Logo
Authors:Márquez-Ramos, Laura
Martínez-Zarzoso, Inmaculada
Issue Date:2010
Citation:[Journal:] Economics: The Open-Access, Open-Assessment E-Journal [Volume:] 4 [Issue:] 2010-11 [Pages:] 1-37 [DOI/URN:] doi:10.5018/economics-ejournal.ja.2010-11
Series/Report no.:Economics 2010-11
Abstract:In this paper, the effect of technological innovation on sectoral exports is analysed using a gravity model of trade. The technological achievement index (TAI) and its four components, creation of technology, diffusion of old innovations, diffusion of recent innovations and human skills, are used as proxies for technological innovation. The two first components are considered proxies for knowledge acquisition and assimilation (potential absorptive capacity), whereas the last two are taken as proxies for knowledge transformation and exploitation (realised absorptive capacity). We hypothesise that the effect of technological innovation on trade could vary according to the technological achievement by generating a non-linear relationship between technological innovation and trade. Our findings indicate a positive and non-linear effect of technological innovation on export performance, which indicates that there are thresholds for positive signs to occur. To foster exports, countries have to consider not only acquisition and assimilation capabilities, but also transformation and exploitation capabilities once a minimum level of potential absorptive capacity has been achieved.
Subjects:Technological innovation
international trade
gravity model
potential and realised absorptive capacity
JEL:F10
Persistent Identifier of the first edition:doi:10.5018/economics-ejournal.ja.2010-11
URL of the first edition:http://www.economics-ejournal.org/economics/journalarticles/2010-11
Creative Commons License:http://creativecommons.org/licenses/by-nc/2.0/de/deed.en
Document Type:Article
Appears in Collections:Economics: The Open-Access, Open-Assessment E-Journal - Journal Articles

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