Reports & Publications

An inquiry into the long-term process of technology transfer from MNCs to domestic enterprises: A comparative study of the motorcycle and automobile industries in India and Thailand

IDE Research Bulletin

March 2019

PDF (39KB)

Background

It is widely recognized that technology transfer from advanced to developing countries or from multinational companies (MNCs) operating in developing countries to domestic enterprises is the engine of economic development in developing countries. However, most of the previous studies on the impact of foreign direct investment on developing economies have shown how the existence of MNCs affect neighboring firms’ productivity by using cross-sectional data. Thus, little is known about the actual channel of technology transfer. Also, few studies have analyzed long term data, though it is natural to assume that technology transfer takes long time.

This project aims to explore the long-term process of technology transfer and industrial development based on the case studies of the motorcycle and automobile industries in India and Thailand. For this purpose, we interviewed many firms in the automotive industry in both countries. Based on the findings from these interviews, we formulated several hypotheses on the development of the industry and tested them using long-term data. The following two papers are the final output of the research project.