Technology diffusion and productivity : evidence from the South African manufacturing sector

• Main Author: Odendaal, Izak
• Format: Dissertation
• Language: English
• Published: University of Cape Town 2015
• Subjects: Philosophy and the Political Economy
• Online Access: http://hdl.handle.net/11427/12787

Includes bibliographical references. === This paper builds on a growing literature on trade-related international technology diffusion. It examines whether South Africa can enhance its productivity by importing machinery and equipment that embodies foreign knowledge from trading partners that do significant amounts of research and development. The focus is on South Africa's manufacturing sector. Furthermore, the paper also examines the role of human capital in the facilitation of the effective adoption of foreign technology. Using trade data from 1976 to 2001 - imports from the European Union, industrialized countries and 'advanced' developing countries - the relationship between capital imports and total factor productivity growth and human capital is analysed using the autoregressive distributed lag (ARDL) approach to cointegration. The results show that there is evidence of an equilibrium relationship between the variables; that foreign technology spillovers have taken place in the manufacturing sector, and that the effect on productivity is enhanced by the presence of quality human capital.