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KNOWLEDGE SPILLOVERS, ABSORPTIVE CAPACITY, AND SKILL INTENSITY OF CHILEAN MANUFACTURING PLANTS

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Abstract:

ABSTRACT. 

Knowledge spillovers are an important source of economic growth. In this study, we identify a mechanism through which knowledge spillovers occur among plants in the Chilean manufacturing industry. A plant-level production function is estimated with the absorptive-capacity hypothesis, that is, employment of skilled workers is a key channel through which knowledge is transmitted across plants. Results show that a plant's productivity from spillovers increases with its skill intensity, which is measured by the share of skilled workers in total employment. We also find that plants in a region with a large knowledge stock increase their skill intensity to benefit more from spillovers. Our results suggest that an increase in regional knowledge stock is the most effective policy to improve a plant's productivity. However, policies that encourage a plant to employ high skill-intensive production also enhance its productivity.

Document Type: Research Article

DOI: https://doi.org/10.1111/j.1467-9787.2010.00677.x

Affiliations: 1: Obihiro University of Agriculture and Veterinary Medicine, Inada-cho Nishi 2 Sen 11, Obihiro, 0808555, Japan., Email: saitoh@obihiro.ac.jp 2: Department of Agricultural and Resource Economics, 213 Ballard Hall, Oregon State University, Corvallis, OR., Email: m.gopinath@oregonstate.edu

Publication date: 2011-02-01

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