How do national differences affect the diffusion of technology across borders? This article extends research on the international diffusion of technology by focusing on the role of institutions on the adoption of technology across borders. Economic institutions, such as human capital and market intermediaries, improve the profitability of technology adoption, making inter-firm differences less relevant to the technology diffusion process. Social institutions, such as cultural practices shared with innovating countries, increase the potential avenues of communication between firms, causing firm-level differences in networking ties to be less significant. Political institutions operate at both levels, with regulatory efficiency in improved property protection and contract enforcement aiding the profitability of technology investments, while trade and investment policies promote additional network ties. Finally, I argue that differences in the transferability of technology affect the moderating role of the three different institutions, with highly transferable technologies most affected by the presence of economic institutions; while less transferable technologies are dependent on social institutions.
- technology diffusion,
- international business
Available at: http://works.bepress.com/robertogalang/8/