Title: Foreign direct investments as an engine of technological change in Malaysia: the role of social interactions

Authors: Manja Jonas

Addresses: Mercator School of Management, Institute of East Asian Studies, University of Duisburg-Essen, 47048 Duisburg, Germany

Abstract: Many developing countries – including Malaysia – try to leverage FDI for local technological change. But our understanding of inter-firm-level processes of technological learning from FDI is still rather limited. This study attempts to shed some light on the role for social interaction in this issue. Based on firm-level survey data, the paper investigates the extent of social relations underpinning backward linkages and analyses the role of social interaction in technological learning from FDI. From a dynamic social learning perspective of technological change FDIs and local firms are conceptualised as members of knowledge networks, comprising FDIs, local buyers/suppliers and other knowledge sources together with their relations. Results suggest that social interactions play a significant role in encouraging technology transfers between foreign firms and their local suppliers, thus contributing to inter-firm knowledge flows.

Keywords: technological change; technological learning; technology transfer; social interaction; foreign direct investment; FDI; Malaysia; Japan; USA; Germany; electronics industry; social learning; knowledge networks; knowledge flows.

DOI: 10.1504/IJTLID.2010.034562

International Journal of Technological Learning, Innovation and Development, 2010 Vol.3 No.2, pp.164 - 186

Available online: 07 Aug 2010 *

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