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The European Journal of Development Research

, Volume 27, Issue 1, pp 122–139 | Cite as

Technological Capabilities, Institutions and Firm Productivity: A Multilevel Study

  • Micheline Goedhuys
  • Martin SrholecEmail author
Original Article

Abstract

National framework conditions directly affect the productivity of firms, but also moderate returns on their technological efforts. Although this has long been recognised, there is a dearth of quantitative analyses that openly consider this hypothesis. Using a data set of 15 425 manufacturing firms in 32 developing countries, we investigate the impact of national institutions on firms’ total factor productivity with the help of multilevel modelling. The results indicate that technological infrastructure and educational system make a large difference, and also most significantly interact with firms’ technological capabilities. However, governance measures that are conventionally considered in the literature explain surprisingly little.

Keywords

productivity innovation technological capability institutions micro data multilevel modelling 

Abstract

Les institutions nationales déterminent directement la productivité des entreprises, mais aussi la rentabilité de leurs efforts en matière de technologie. Bien que cela ait été reconnu depuis longtemps, il y a bien peu d’analyses quantitatives qui ouvertement analysent cette hypothèse. On a étudié l’impact des institutions nationales sur la productivité multifactorielle des entreprises utilisant un modèle hiérarchique et une base de données incluant 15 425 entreprises manufacturières en 32 pays en voie de développement. Les résultats indiquent que l’infrastructure technologique et le système éducatif ont une forte influence, et qu’ils interagissent avec les capabilités technologiques des entreprises. Cependant, les mesures de gouvernance conventionnellement utilisées dans la littérature ont bien peu de pouvoir explicatif.

Notes

Acknowledgements

Financial support from the Czech Science Foundation (GAČR) project P402/10/2310 on ‘Innovation, productivity and policy: What can we learn from micro data?’, STRIKE (Science and Technology Research in a Knowledge-based Economy) funded as Action No. IS0604 by COST for short term scientific missions (COST-STSM-IS0604-04148), and institutional support RVO 67985998 from the Academy of Sciences of the Czech Republic and VINNOVA Core Funding of Centers for Innovation Systems Research project 2010-01370 on ‘Transformation and Growth in Innovation Systems: Innovation Policy for Global Competitiveness of SMEs and R&I Milieus’ is gratefully acknowledged. Earlier versions of the article were presented at the Globelics 7th International Conference in Dakar, Senegal, October 2009, the 6th Biennial Conference of the Czech Economic Society in Prague, November 2010 and the DRUID 2011 Conference in Copenhagen, June 2011. The article has benefited from comments and suggestions from participants at these and other events, in particular Théophile Azomahou, Bart Verspagen, Cristina Chaminade, Gustavo Crespi, Jan Fagerberg, Mark Knell, Lubomír Lízal, Bengt-Åke Lundvall, Pierre Mohnen, Roberta Rabellotti, Adam Szirmai and Reinhilde Veugelers, as well as from the referees of this journal. All the usual caveats apply.

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Copyright information

© European Association of Development Research and Training Institutes 2014

Authors and Affiliations

  1. 1.United Nations University, UNU-MERITMaastrichtThe Netherlands
  2. 2.Center for Economic Research and Graduate Education-Economics Institute (CERGE-EI)Prague
  3. 3.Centre for Innovation, Research and Competence in the Learning Economy (CIRCLE)LundSweden

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