Assessing the Drivers of R&D Activities of Firms in Developing Countries: Evidence From Turkey

Kalayci E., Pamukcu T.

EUROPEAN JOURNAL OF DEVELOPMENT RESEARCH, vol.26, no.5, pp.853-869, 2014 (Peer-Reviewed Journal) identifier

  • Publication Type: Article / Article
  • Volume: 26 Issue: 5
  • Publication Date: 2014
  • Doi Number: 10.1057/ejdr.2014.12
  • Journal Indexes: Social Sciences Citation Index, Scopus
  • Page Numbers: pp.853-869
  • Keywords: foreign R&D, FDI spillovers, linkages, R&D subsidies, Heckman selection, instrumental variables, Turkey, FOREIGN DIRECT-INVESTMENT, DOMESTIC FIRMS, SPILLOVERS, GROWTH, BENEFIT


Research and development (R&D) activities of firms in developing countries (DCs) have been gaining in importance for nationwide economic growth and development, while globalization of the world economy offers a number of opportunities for fostering knowledge-creating activities. Therefore, a better understanding of factors influencing R&D activities of firms in DCs with a view to conceive and implement appropriate policies is firmly on the agenda. In this article, a rich firm-level data set and a new estimation methodology with selection and endogeneity correction are used over the period 2003-2007 to investigate drivers of manufacturing R&D in Turkey. Our results indicate positive effects of foreign direct investment (FDI)-related vertical R&D spillovers, R&D subsidies and distance to technology frontier on R&D intensity, whereas FDI-related horizontal R&D spillovers, firm size and export intensity exert a negative effect.