Technology Endowments Research Articles

The “Simultaneous Development of Quantity and Quality”: Research on the Impact of the Digital Economy in Enabling Manufacturing Innovation

The digital economy is the future direction of global development, and its innovation-driven effect has become the focus of scholars. This study takes China’s Shanghai and Shenzhen A-share listed manufacturing enterprises from 2012 to 2022 as research samples and uses a text-analysis method to measure the comprehensive index of the regional digital economy. Based on the dual dimensions of quantity and quality, we empirically test the actual impact of the digital economy on manufacturing innovation. The results show the following: (1) The internal components of the digital economy include data elements, digital technology, and digital infrastructure, which have a significant role in promoting manufacturing innovation. (2) There are significant differences in the release of digital economy innovation dividends among enterprises with different growth stages, property rights, and technology endowments. (3) From the macro-regional level, the rational allocation of R&D personnel and R&D funds is an effective way for the digital economy to enable manufacturing innovation. In addition, from the micro-enterprise level, factor-combination and information-optimization effects are also effective ways for the digital economy to drive manufacturing innovation. (4) Further, the impact of the digital economy on manufacturing innovation is nonlinear, with changes in internal composition. This study helps to break through the obstacles of the digital economy to achieve innovation empowerment and provides a theoretical reference for the manufacturing industry to continue to spur innovation vitality.

Drivers of firms’ digital activities in response to the Covid-19 pandemic

The aim of the paper is to analyse the main internal drivers of the increase and adoption of online activities carried out by firms in reaction to the Covid-19 pandemic. While the impact of Covid-19 pandemic on several measures of firm-level performance has been debated in many papers, not enough effort has been devoted to investigating its digitalization impact, especially with respect to the drivers of firms operating in transition countries. To this end, we explore a very detailed firm-level dataset, drawn from the World Bank Enterprise Survey (WBES) combined with the Covid-19-ES Follow-up Survey, for 22 Eastern European and Central-Eastern Asian countries. Our findings reveal that (i) higher online activity is associated with higher digital and technological endowment of the firm and (ii) this relationship is shaped by external factors, such as country-level digital infrastructure.

Shaping the local business structure: drivers of firm location at the municipal level

ABSTRACT Because local economic development is linked to the ability to attract business, policymakers have begun to endow territories with suitable factor conditions for the enticement of new enterprises, as in the case of EU Structural Funds. We investigate this phenomenon to provide valuable policy suggestions with a dynamic factor model and a panel regression analysis with spatial effects on a database with many cross-sections (1531 municipalities) and variables (55 indicators). Results show that structural variables like technological endowment, infrastructural provision, productive structure, local taxation, human capital and innovation represent the most important drivers to stimulate business location, even at the municipal level, offering relevant cues for policymakers.

The synergy effect of energy security and carbon-haze collaborative management: From the perspective of biased technological progress

It is important to ensure energy security and achieve carbon-haze collaborative management for sustainable development. Reducing imported energy dependence is necessary to maintain energy security, while its impact on environmental quality remains unclear. From the perspective of biased technological progress, this paper estimates the level of biased technological progress towards self-sufficient energy by a heterogeneous stochastic frontier analysis (SFA) function, and then empirically examines whether self-sufficient energy biased technological progress has a dampening effect on haze pollution and carbon emissions. It is found that: (1) Self-sufficient energy biased technological progress can effectively reduce haze pollution and carbon emissions, achieving a synergistic effect between energy security and carbon-haze collaborative management. (2) “Efficiency enhancement” and “quality improvement” are the essential mechanisms for the synergistic effect. (3) Environmental regulation, abundant resource and technology endowments can enhance the haze reduction effect. And the lower dependence on foreign trade and stable global economic policy environment are more conducive to achieving carbon-haze collaborative control. (4) In the Eastern and Western regions, self-sufficient energy biased technology can be sped up to alleviate haze pollution. The findings can enrich the research exploring pollution control from the perspective of biased technological progress, and provide policy recommendations for promoting high-quality development.

The effect of heterogeneous national technological capabilities on a Net-zero energy system

Numerous studies have linked the heterogeneous nature of national technological capabilities to the disparities in country-level low-carbon investment patterns. This study investigates how differences in national and regional technological capabilities can impact the pathway to a global net-zero energy system using an integrated assessment modeling approach. The study begins by developing a novel metric that captures the heterogeneity of national low-carbon technological endowments. The metric is then modeled to explore the regional and global low-carbon investment and CO2 abatement trends. Modeling results reveal that the heterogeneity of low-carbon technological competencies induces an asymmetry in low-carbon investments across countries and regions. This asymmetry is driven by a low-carbon investment gap created by developing economies with inferior technological capabilities. Conversely, frontier low-carbon technology regions increase their technology deployment efforts to compensate for the investment deficits. The resultant impact of the asymmetry leads to a moderate but non-trivial increase (i.e., 5.1 to 9.3 %) in the policy cost for achieving the net-zero energy target. Insights gleaned from this computational thought experiment reassert the importance of supporting local technological capabilities in the context of global climate mitigation.

Social venture scaling: Does the technological environment matter?

In a generalizable multi-year sample of U.S. counties, we demonstrate that horizontal scaling of social ventures is explained by technological factors including technological endowment (patent stock) and the availability of technological arbitrage opportunity, as well as the growth in these two factors over time. Both the technological endowment and the availability of technological arbitrage opportunity are positively related to social venture scaling. However, growth in the technological endowment eases the pressure on social entrepreneurs to act thus exerting negative impact on social venture scaling. At the same time, growth in the availability of technological arbitrage opportunity indicates that the relative efficiency within the county lags behind the frontier established by the leading counties, which may exacerbate social ills to which social entrepreneurs respond. Accordingly, it exerts a positive impact on social venture scaling observed.

Are vulnerable farmers more easily influenced? Heterogeneous effects of Internet use on the adoption of integrated pest management

The Internet is believed to bring more technological dividends to vulnerable farmers during the green agriculture transformation. However, this is different from the theory of skill-biased technological change, which emphasizes that individuals with higher levels of human capital and more technological endowments benefit more. This study investigates the effects of Internet use on farmers’ adoption of integrated pest management (IPM), theoretically and empirically, based on a dataset containing 1 015 farmers in China's Shandong Province. By exploring the perspective of rational inattention, the reasons for the heterogeneity of the effects across farmers with different endowments, i.e., education and land size, are analyzed. The potential endogeneity issues are addressed using the endogenous switching probit model. The results reveal that: (1) although Internet use significantly positively affects farmers’ adoption of IPM, vulnerable farmers do not benefit more from it. Considerable selection bias leads to an overestimation of technological dividends for vulnerable farmers; (2) different sources of technology information lead to the difference in the degree of farmers’ rational inattention toward Internet information, which plays a crucial role in the heterogeneous effect of Internet use; and (3) excessive dependence on strong-tie social network information sources entraps vulnerable farmers in information cocoons, hindering their ability to reap the benefits of Internet use fully. Therefore, it is essential to promote services geared towards elderly-oriented Internet agricultural technology information and encourage farmers with strong Internet utilization skills to share technology information with other farmers actively.

Analyzing the effect of health reforms on the efficiency of Ecuadorian public hospitals.

This study aims to assess whether Ecuadorian health reforms carried out since 2008 have affected the efficiency performance of public hospitals in the country. We contribute to the literature by shedding new light on the effects on public healthcare efficiency for developing countries when policies move toward health equity and universal coverage. We follow a two-stage approach, wherein the first stage we make use of factor and cluster analysis to obtain three clusters of public hospitals based on their technological endowment; we exploit Data Envelopment Analysis for panel data in the second stage to estimate robust efficiency measures over time. Our innovative empirical strategy considers the heterogeneity of healthcare institutions in the analysis of their efficiency performance. The results show a significant decrease in the average efficiency of low and intermediate technology hospitals after the new constitution was adopted in 2008. The decline in efficiency coincides with the two reforms of 2010 and 2011 that brought on higher social security coverage.

The Impact of Carbon Trading Pilot Policy on Carbon Neutrality: Empirical Evidence from Chinese Cities.

As one of a number of crucial policies for achieving the goal of "double carbon", it is crucial to investigate the "carbon neutral" effect of the carbon trading market (CTM) in the pilot phase, which is an essential reference for the development of a future CTM. Based on panel data of 283 cities in China in the period from 2006 to 2017, this paper examines the impact of the Carbon Trading Pilot Policy (CTPP) on the achievement of the "carbon neutrality" target. The study shows that the CTPP market can promote an increase in regional net carbon sinks and further accelerate the achievement of the "carbon neutrality" goal. The findings of the study remain valid after a series of robustness tests. The mechanism analysis finds that the CTPP can help achieve the carbon neutrality target through three mechanisms: the effect on concern for the environment, the effect on urban governance, and the effect on energy production and consumption. Further analysis reveals that enterprises' willingness and productive behavior, as well as the internal elements of the market, have a positive moderating effect on the achievement of the carbon neutrality target. In addition, there is heterogeneity among regions with different technological endowments, CTPP regions, and regions with different shares of state-owned assets in the CTM. This paper provides important practical references and empirical evidence that can help China to better achieve the "carbon neutrality" target.

The environmental effects of the “twin” green and digital transition in European regions

This study explores the nexus between digital and green transformations—the so-called “twin” transition—in European regions in an effort to identify the impact of digital and environmental technologies on the greenhouse gas (GHG) emissions originating from industrial production. We conduct an empirical analysis based on an original dataset that combines information on environmental and digital patent applications with information on GHG emissions from highly polluting plants for the period 2007–2016 at the metropolitan region level in the European Union and the UK. Results show that the local development of environmental technologies reduces GHG emissions, while the local development of digital technologies increases them, albeit in the latter case different technologies seem to have different impacts on the environment, with big data and computing infrastructures being the most detrimental. We also find differential impacts across regions depending on local endowment levels of the respective technologies: the beneficial effect of environmental technologies is stronger in regions with large digital technology endowments and, conversely, the detrimental effect of digital technologies is weaker in regions with large green technology endowments. Policy actions promoting the “twin” transition should take this evidence into account, in light of the potential downside of the digital transformation when not combined with the green transformation.

Effects of Technology Endowment on Open Innovation Success in Medium-Sized Enterprises in Kenya

Technology is an infrastructural enabler that ensures success of open innovation (OI) activities in modern enterprises. The Kenyan experience indicates that the OI success strategy for medium enterprises (MEs) hinges on endowment of technological capabilities in operation and management of MEs. Notwithstanding, the aggregate entrepreneurial orientation (EO) of firms seems to be a determining factor in connecting the technological investment and stakeholders’ collaboration to activate the innovation potential of MEs. This study sought to determine the moderating role of EO on the relationship between firms’ technological endowment and OI success of service and manufacturing MEs in Kenya. The data collected were analyzed using Statistical Package for Social Scientists (SPSS) Version 23 and Smart PLS3 application software. The formulated hypotheses were tested using structural equation modelling. The results showed that Technology positively influences OI success; however, they did not confirm that EO moderates the Technology and OI success relationship. While the study recommends a strategic investment in Technology to enhance OI success, it also advises further research into the dynamics of the triple relationship between Technology, EO and OI Success to optimize their combination for enhanced organizational innovation.

Teleworking in Romania during Covid-19 crisis: From conjunctional adaptation to change of economic paradigm

The COVID-19 crisis has led to a raise in the number of people working remotely. This paper aims at identifying the extent to which the pandemic will determine a paradigm change regarding teleworking in Romania Our research is based on two surveys designed to assess the impact of teleworking both on individuals and on efficiency at the organizational level. The results show that, generally, teleworking has significant advantages, both for employees and employers. As we become aware of these advantages, it is quite likely that Romania will experience a paradigm shift in terms of teleworking, as both managers and employees consider that teleworking becomes a very good option. However, the changes will be gradual and with different intensities at the sectoral level, as teleworking must be adapted to the specificities of each sector or activity. While some sectors tend to make teleworking the new organizational culture, others will capitalize on the benefits of teleworking progressively, in relation to technological endowments and structural changes that will continue to occur. On the other hand, teleworking has the advantage of promoting the improvement of digital skills for employees, which is a great step forward for a higher degree of digitisation.

Trade Specialisation and Changing Patterns of Comparative Advantages in Manufactured Goods

Starting from the late 1950s, mainly as a reaction to Leontief’s paradoxical results, a large amount of research has underlined the great importance of technology and human capital in explaining international trade in manufactures. This study examines the patterns of comparative advantages for 42 countries and 91 manufactured classes of final and intermediate products and their changes between 2001 and 2019. The dynamics and the effects of the international fragmentation of production processes are also considered. Comparative advantages in each class of products are related to three different measures of a country’s human capital or technology endowment: the cost of labour, the level of formal education and the number of patents per capita. An indicator of home market size enters the model as a control variable. The econometric analysis reveals that in 2019, human capital or technology endowments explain comparative advantages in 70 out of 91 products. In particular, 31 products are positively and significantly associated with at least 1 of the 3 human capital or technology indicators, 34 products are negatively and significantly linked to at least 1 indicator, 5 products show contrasting results, 21 products are not related to any human capital or technology indicator. Between 2001 and 2019, comparative advantages for 15 classes of products shifted towards lower-technology countries and for 18 productions towards higher-technology countries. There were no shifts for 51 products. From a policy perspective, the distinction between high and low-technology productions could have some interesting implications. Since high-technology productions are characterised by a higher learning-by-doing rate, governments should foster domestic firms to upgrade the human capital or technology intensity of their productions.

How do MNEs invent? An invention-based perspective of MNE profitability

Although MNEs create inventions both internally and collaboratively with partners as well as within and across countries, we know very little about the effects that combining such inventive activities have on their profitability. This study develops an invention-based perspective that considers how MNEs' profitability is influenced by the ways they organize the development of inventions across organizational boundaries (internally or collaboratively) and geographic boundaries (within or across countries). This perspective postulates that profitability is not merely driven by advantageous technological endowments but also by how such technological assets have been created. Accordingly, it explains why specific combinations of inventive activities across the two boundaries affect the likelihood of creating breakthrough inventions differently, provide different revenue and cost advantages, and have different effects on MNEs’ profitability. It further explains why cross-country inventions contribute more to profitability when they are internalized, while within-country inventions are more profitable when they are created collaboratively.

Imported Intermediate Goods and Economic Growth

Purpose - This research aims to provide empirical evidence that highlights the importance of imported intermediate goods in long-term economic growth. To this end, this paper develops an index that measures the productivity gains associated with a country’s intermediate goods imports using highly disaggregated trade data. Design/methodology - The basic hypothesis is that countries sourcing higher-productivity (or higher-quality) inputs from developed economies derive a larger benefit from foreign R&D. To explore this hypothesis, standard cross-country growth regressions are performed using the highly disaggregated data from the United Nations (UN) Commodity Trade Statistics Database (COMTRADE). To address the endogeneity issue, I apply an instrumental variable (IV) approach. Findings - The results of this study demonstrate that the index predicts subsequent economic growth in middle- and low-income countries. This finding is consistent with previous studies that have argued that developing countries can achieve substantial productivity gains by importing intermediate inputs from developed countries. By contrast, there is no evidence of a significant association between the index and economic growth in high-income countries. Originality/value - This paper contributes to our understanding of the causal relationship between international trade and economic growth. From an economic policy perspective, the results suggest that developing countries with limited technology endowment can boost growth from input-tariff liberalization.

Regional Technological Capabilities and the Access to H2020 Funds

AbstractThis contribution provides fresh evidence on the factors facilitating the access to H2020 funds by EU regions focusing on the role played by pre‐existing technological endowments. The empirical analysis aims at assessing if, and the extent to which, the regional distribution of such resources strictly reflects the technological capabilities of regions (with the risk of a perpetuation or even a deepening of pre‐existing technological gaps) or, alternatively, whether a rebalancing allocation mechanism (able to mitigate technological asymmetries) is at work. We show that an overall rebalancing effect of H2020 seems to dominate thanks to the ‘collaborative‐inclusive logic’ of the Research and Innovation Actions (RIA) and the Innovation Actions (IA). The latter have been able to more than compensate the ‘elitarian’ nature of the other two pillars of H2020, namely the European Research Council (ERC) and the Marie Skłodowska‐Curie Actions.

Firm‐level aggregate corruption and competition: The role of telecommunications infrastructure

AbstractThis study examines the relationship between competition and corruption in the presence of enhanced telecommunications infrastructure. We use firm‐level aggregate data provided by the World Bank Enterprise Surveys and collected between 2006 and 2018. Our fixed‐effects results are two‐fold. First, the number of competing firms increases corruption in developing countries. This result is consistent with the previous literature on the competition‐corruption nexus. Second, corruption decreases as the number of competing firms increases in countries with better information and communication technology endowment. Our results are robust to controlling for endogeneity via the two‐step, feasible efficient generalized method of moments and suggest that e‐governance may help to reduce firm‐level corruption in a competitive environment. Given the negative impact of corruption on investment and growth, developing countries should aim at adopting and using more telecommunications infrastructure, along with the traditional approaches of combatting corruption that are based on enforcing rules of law or building stronger institutions, just to name a few, to boost investment and economic growth.

The right care at the right place with the right specialist.

We had read with great interest the commentary by Nobuaki Shime and by Hiroyuki Ohbe [1,2]. Recently, we shared our thoughts [3], where were clearly find the need to increase the number of intensive care beds, but most important, human resources. Regarding this, we would like to highlight that, it is not only paramount to have physical space, and technological endowment with monitors and advances devices to treat all the possible scenarios, but without adequate human resources and highly trained personnel with adequate training to face all the possible challenges that may be faced in the day-to-day running of an ICU, this physical space and equipment would not ensure good results.

Technological Innovation and Circular Economy Practices: Business Strategies to Mitigate the Effects of COVID-19

The Corona Virus Disease 2019 (COVID-19) has been a tough test on companies in the global food sector supply chain, exacerbating the realities and deficiencies it presents in developing economies. This situation has been reflected in the firm’s performance (F.P.) due to the lack of business conditions to respond to the current pandemic. However, in some companies, the adverse effects of COVID-19 have been counteracted due to endowment and technological capabilities. Thus, this study examined the role of technological innovation (T.I.) and business data analytics (B.D.A.) in the F.P. of foods in Ecuador during COVID-19. A questionnaire collected the information from the food firms. Then, Covariance-Based Structural Equation Modeling processed the collected information. We found that (B.D.A.) mechanisms and different levels of T.I. within the developing market significantly shape the F.P. The results showed that the B.D.A. enables circular economy (C.E.) practices and the improvement of product delivery services, which constitutes an improvement of the F.P. The COVID-19 outbreak did not significantly affect T.I., unlike what happened with B.D.A. This study concluded that firms with the most extraordinary technological production processes have been the least affected during COVID-19. This study suggested that policy measures should boost food firms’ technological endowment to improve their resilience in uncertainty and risk scenarios.

Modelling Multiple Regimes in Economic Growth by Mixtures of Generalised Nonlinear Models

The new model class of mixtures of generalised nonlinear models (GNMs) is introduced. The model is specified, identifiability issues discussed, the fitting in a maximum likelihood framework using the expectation-maximisation (EM) algorithm outlined and an appropriate computational implementation introduced. The new model class is applied to capture cross-country heterogeneity when considering the augmented Solow model including human capital accumulation as underlying model structure. The inherent heterogeneity is attributed to multiple regimes being present within the selected country data set. The results highlight that country-specific differences lead to distinct components. Countries belonging to the same component exhibit convergence to a homogeneous steady state. The components differ in the initial technological endowment and the contribution of the economic variables to economic growth.