Globalisation and Productivity Growth: Theory and Evidence

192 Pages·2005·0.625 MB·English

by  Holger Görg, David Greenaway, Richard Kneller (eds.)

Globalisation and
Productivity Growth
Theory and Evidence
Edited by
Holger Görg, David Greenaway and
Richard Kneller
Globalisation and Productivity Growth
This page intentionally left blank
Globalisation and
Productivity Growth
Theory and Evidence
Edited by
Holger Görg, David Greenaway and
Richard Kneller
Leverhulme Centre for Research on Globalisation and Economic Policy,
University of Nottingham
Selection and editorial matter © Holger Görg,David Greenaway and
Richard Kneller 2005
Individual chapters © contributors 2005
Softcover reprint of the hardcover 1st edition 2005 978-1-4039-3499-4
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First published in 2005 by
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ISBN 978-1-349-51758-9 ISBN 978-0-230-52322-7 (eBook)
DOI 10.1057/9780230523227
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Library of Congress Cataloging-in-Publication Data
Globalisation and productivity growth :theory and evidence /
edited by Holger Görg,David Greenaway,and Richard Kneller.
p.cm.
Includes bibliographical references and index.
1.Industrial productivity.2.Investments,Foreign.3.International
business enterprises.4.Exports.5.Globalization – Economic aspects.
I.Title:Globalization and productivity growth.II.Görg,Holger.
III.Greenaway,David.IV.Kneller,Richard.
HC79.I52G57 2005
338(cid:2).06(cid:2)09051—dc22 2005048114
10 9 8 7 6 5 4 3 2 1
14 13 12 11 10 09 08 07 06 05
Contents
List of Tables vii
List of Figures ix
Acknowledgements x
Notes on Contributors xi
1 Introduction and Overview 1
Holger Görg, David Greenaway and
Richard Kneller
Part I Aggregate Productivity Growth
2 Globalisation and Aggregate Productivity Growth 9
Michael Henry and Chris Milner
3 Liberalisation and Aggregate Productivity Growth 28
David Greenaway and M. Emranul Haque
Part II Cross Border Investment and
Productivity
4 Foreign Direct Investment and Productivity Growth: Theory 49
Ben Ferrett
5 Empirical Evidence on Foreign Ownership and
Productivity Growth 79
Sourafel Girma, Steve Thompson and
Peter Wright
6 Multinational Enterprises and Spillovers 92
Holger Görg and Alexander Hijzen
Part III Exporting and Productivity
7 Exporting and Productivity Growth: Theory 117
Rod Falvey and Zhihong Yu
8 Empirical Evidence on Exporting and Productivity
Growth in the UK 136
David Greenaway and Richard Kneller
v
vi Contents
9 Multinationals, Exporting and Overseas
Production 156
Sourafel Girma, Richard Kneller and
Mauro Pisu
Index 177
List of Tables
2.1 Results of OLS regressions cross section estimations –
dependent variable: TFP growth (average 1980–90) 14
2.2 Results of OLS regressions cross section estimations –
dependent variable: TFP growth (average 1980–90) 15
2.3 Instrumental variables (2SLS) regressions cross section
estimations – dependent variable: TFP growth
(average 1980–90) 17
2.4 Instrumental variables (2SLS) regressions cross section
estimations – dependent variable: TFP growth
(average 1980–90) 18
2.5 Panel estimates (1960–90) 5-year averages – dependent
variable: TFP growth 21
2.6 Panel estimates (1960–90) annual – dependent variables:
TFP growth 23
3.1 Components of liberalisation episodes: the
Papageorgiouetal. study 37
3.2 Elements of recent trade liberalisations 39
5.1 Average employment, wages and labour productivity
of domestic- and foreign-owned firms in
UK manufacturing industry 82
5.2 The impact of ownership on labour productivity 84
5.3 The impact of ownership on total factor productivity 86
5.4 The impact of ownership changes on wage rates by type
of acquisition 87
6.1 Summary statistics 101
6.2 Descriptive statistics by export behaviour, 1988–96 102
6.3 Summary statistics by nationality of ownership 103
6.4 Basic regression results by export activity 105
6.5 Regression results by export and domestic market
orientation MNEs 106
6.6 Regression results with absorptive capacity and
intangible assets 108
6.7 Regression results by nationality 109
7.1 Summary of model differences 128
8.1 Percentage difference between exporters and
non-exporters and their statistical significance 138
vii
viii List of Tables
8.2 Probability model of exporting 141
8.3 Transitions in and out of exporting 142
8.4 Characteristics of new exporters versus established
exporters and non-exporters 142
8.5 Probit model of export market entry 143
8.6 Probit model of export market entry: agglomeration effects 145
8.7 Sample characteristics of exporters and non-exporters
in a matched sample of firms 150
8.8 Effect of export market entry on firm performance
for a matched and unmatched sample of firms 151
9.1a World merchandise exports/GDP 166
9.1b Foreign assets/world GDP 166
9.2 Summary statistics 171
9.3 The determinants of MNEs’ exports (UK) 171
List of Figures
4.1 North–South FDI flows in general equilibrium à la Solow 52
4.2 Game tree for simplified Fosfuri/Motta/Rønde model 59
4.3 The MNE’s equilibrium period-1 choices 61
4.4 Equilibrium industrial structures in the international
duopoly game 64
4.5 Equilibrium industrial structures 68
7.1 Flow chart showing productivity uncertainty and
firm entry/exit 125
7.2 Productivity heterogeneity and with-in industry
reallocation 126
9.1 Probability density of productivity and firm choice 163
ix