Multinational firms and productivity catching-up: the case of Chilean manufacturing
by Roberto Alvarez, Gustavo Crespi
International Journal of Technological Learning, Innovation and Development (IJTLID), Vol. 1, No. 2, 2007

Abstract: In this paper, we study Total Factor Productivity (TFP) catching-up using 20 years of plant-level data for Chilean manufacturing. This paper addresses two key issues: first, we analyse whether there is evidence that low-productivity plants experience higher TFP growth than those closer to the technology frontier. Second, we investigate the role of multinational plants in accelerating the catching-up process by non-frontier domestic plants. Our results show evidence of productivity catching-up, and that a larger presence of multinationals positively contributes to this phenomenon. These findings are consistent with the idea of technology spillovers from high to low-productivity plants or that a higher presence of multinationals increase competitiveness and productivity in domestic markets.

Online publication date: Sun, 14-Oct-2007

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