Trade, foreign R&D, and foreign direct investment: Sources for international spillovers and economic growth in Latin America and Asia

In this dissertation, I explore the mechanisms by which international trade and FDI affect economic growth in a sample of 12 Latin American and a sample of 7 Asian countries during the period 1970--94. In a series of 3 chapters, I examine the extent to which these channels affect growth according to neo-classical growth theory, where growth comes through changes in the level of factor inputs, or according to "new growth theory", where growth comes through changes in the level of Total Factor Productivity (TFP). In Chapters 1 and 2 I test the effects of aggregate exports, aggregate imports, the components of aggregate exports and imports, machinery and equipment imports, and foreign R&D on TFP. I also include educational attainment and domestic investment as two potential internal channels for affecting productivity. In Chapter 3, I examine some of the inconclusive findings in Chapters 1 and 2 by testing the effects of international trade and FDI on economic growth. The empirical estimates suggest growth in Latin America is driven more by changes in the level of factor inputs while growth in Asia is driven more by changes in the efficiency of its factor inputs.