International Trade And Technology Diffusion

Nowadays, technology progress have become an indispensable factor in the growth of economy all over the world, furthermore, in a open economy, national or local's technology progress not only depend on domestic R&D, but also more and more on foreign R&D. In the economic globalization, international trade is not only a main way to economy and culture intercommunion in the world, but also become an important channel to gain international technology diffusion for developing counties.Base on the reviews of previous studies, this paper tests the effect of international technology diffusion through import in China with the CH model (Coe and Helpman, 1995), using Panel data of the manufacturing bilateral trade and R&D expenditure of China and 13 OECD countries' over the period 1996-2003. The results show that both the R&D expenditure of domestic manufacturing and the international technology diffusion through import play a positive role in the TFP(Total Factor Productivity) growth, but the domestic own-industry R&D has contributed more to TFP than the foreign R&D, which reflects that the technological progress of manufacturing mainly rely on domestic own-industry R&D ; the results also show that the technology diffusion from USA import trade plays an active role in our own-industry's technological progress, in contrast to America, the Japan and other OECD countries even have an negative influence on it. Finally, the results indicate that foreign R&D also affect TFP via export, despite the levels is not high. The results also made clear that export have bring an effect of international technology diffusion, though statistical significant level is not high.At last, this essay contrasted our country's manufacturing with Korea's, the outcome showed that two countries were quite similar in trade structure, but were quite different in absorbing the effect of international technology diffusion in trade. The efficiency of Korea absorbing the effect of international technology diffusion is much more efficient than our country.