Keywords: technology, exports, foreign ownership, technological intensity, automotive comonents industry, electronics industry, garment industry, clothing industry, apparel industry, Indonesia, technological capabilities, research and development, R&, D, process technology, human resources, indigenous industry, foreign direct investment, FDI, globalisation
Foreign ownership, technological intensity and export incidence: a study of auto parts, electronics and garment firms in Indonesia
This paper uses the technological capabilities framework to examine differences in technological intensities between foreign and local auto parts, electronics, and garment firms in Indonesia. The results show that foreign firms enjoyed higher export incidence than local firms in all three industries, overall technology and human resource intensity means than local firms in auto parts and electronics, process technology means than local firms in electronics, and higher process technology and R&D means than local firms in all three industries. The econometric results show a strong relationship between export-incidence, and overall technological and its components of human resource and process technology intensities. Foreign ownership was not only positively correlated in the overall sample of the human resource regression, but the coefficient of export-incidence was also higher in the foreign firms' sample than in the local firms' sample.