Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress?
This article investigates the spillover effects of foreign direct investment (FDI) on productivity growth in the Indonesian food-processing (ISIC 311) and electrical machinery industries (ISIC 383). Total factor productivity (TFP) growth is decomposedinto efficiency change and technological change b...
| Main Authors: | , |
|---|---|
| Format: | Journal Article |
| Published: |
Institute of Economics Research
2010
|
| Subjects: | |
| Online Access: | http://hdl.handle.net/20.500.11937/28366 |
| _version_ | 1848752517129699328 |
|---|---|
| author | Suyanto, Suyanto Salim, Ruhul |
| author_facet | Suyanto, Suyanto Salim, Ruhul |
| author_sort | Suyanto, Suyanto |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | This article investigates the spillover effects of foreign direct investment (FDI) on productivity growth in the Indonesian food-processing (ISIC 311) and electrical machinery industries (ISIC 383). Total factor productivity (TFP) growth is decomposedinto efficiency change and technological change by using the Malmquist productivity index. The empirical results show that efficiency improvement is the major driver of TFP growth in the food-processing industry, whereas technological progress is the dominant contributor in the electrical machinery industry. There are positive spillovers on efficiency change but negative spillovers on technological change in the food-processing industry. However, FDI spillovers turn out to be negative in efficiency change while positive in technological progress in the electrical machinery industry.These findings demonstrate that different industries experience different sources of productivity gains, which are dependent on the characteristics of firms in the industry. |
| first_indexed | 2025-11-14T08:09:52Z |
| format | Journal Article |
| id | curtin-20.500.11937-28366 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T08:09:52Z |
| publishDate | 2010 |
| publisher | Institute of Economics Research |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-283662023-02-22T06:24:18Z Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? Suyanto, Suyanto Salim, Ruhul FDI TFP growth Efficiency change Technological change This article investigates the spillover effects of foreign direct investment (FDI) on productivity growth in the Indonesian food-processing (ISIC 311) and electrical machinery industries (ISIC 383). Total factor productivity (TFP) growth is decomposedinto efficiency change and technological change by using the Malmquist productivity index. The empirical results show that efficiency improvement is the major driver of TFP growth in the food-processing industry, whereas technological progress is the dominant contributor in the electrical machinery industry. There are positive spillovers on efficiency change but negative spillovers on technological change in the food-processing industry. However, FDI spillovers turn out to be negative in efficiency change while positive in technological progress in the electrical machinery industry.These findings demonstrate that different industries experience different sources of productivity gains, which are dependent on the characteristics of firms in the industry. 2010 Journal Article http://hdl.handle.net/20.500.11937/28366 10.1111/j.1746-1049.2010.00115.x Institute of Economics Research unknown |
| spellingShingle | FDI TFP growth Efficiency change Technological change Suyanto, Suyanto Salim, Ruhul Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? |
| title | Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? |
| title_full | Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? |
| title_fullStr | Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? |
| title_full_unstemmed | Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? |
| title_short | Sources of productivity gains from FDI in Indonesia: is it efficiency improvement or technological progress? |
| title_sort | sources of productivity gains from fdi in indonesia: is it efficiency improvement or technological progress? |
| topic | FDI TFP growth Efficiency change Technological change |
| url | http://hdl.handle.net/20.500.11937/28366 |