Introduction: Development Aid—Theory, Policies, and Performance

This is an introduction to the Special Issue. The author provides the background to the development aid arena—to which there clearly exists a pressing need to evaluate progress to date—and introduces and links together the papers that constitute the Special Issue.     

E-commerce,R&D,and productivity: Firm-level evidence from Taiwan

This study investigates the impact of e-commerce and R&D on productivity, using a unique panel dataset obtained from Taiwanese manufacturing firms for the period from 1999 to 2002. We specifically consider the network externalities of e-commerce and employ the system generalized method of moment (GMM) technique to deal with the endogenous problem of e-commerce adoption. The empirical results show that both e-commerce and R&D capital have a positive influence on productivity, while R&D exhibits a larger productivity-enhancing effect. We also find a complementary relationship between e-commerce and R&D on enhancing productivity. Crucially, the inter-industry network externality of e-commerce significantly contributes to productivity.     

R&D,productivity, and exports: Plant-level evidence from Indonesia

This study examines the relation between productivity and exports in Indonesian manufacturing firms by taking account the endogenous choice of R&D. We first examine the determinants of R&D activity and find that exporting activity contributes positively to plants' R&D activity, while multinational corporate do not have a higher R&D propensity. The simultaneous estimates on the interrelation of R&D, productivity, and export show that R&D has a positive impact on both productivity and exports, suggesting the importance of R&D to Indonesian economic growth. It suggests also a two-way causality between productivity and exports, implying the coexistence of self-selection and learning-by-exporting effects in Indonesian manufacturing sector.     

Response to Butos & Koppl: Expectations,exogeneity, and evolution

In Input–Output analysis, the term ‘important coefficients’ refers to direct intersectoral connections, behind which lie substantial indirect connections, such that a small change in one of those coefficients would have a large impact on the output of a related sector. This paper employs important coefficients as indicators of the level of integration between the industries in an economic structure. An economic structure is defined as a set of interdependent sectors linked by a set of intermediate demand flows. Such flows define the character of the aforementioned structure. It is hypothesized that changes in the level of integration affect the ability an economy has to provide welfare opportunities to its population. The paper also shows that a reduction in the degree of integration of an economy weakens its ability to achieve steady growth, because of the loss of the propagating effects of an expanding demand, even if exports expand at high rates. This might explain the disappointing performance of the Mexican economy in regard to these issues even after structural reforms have been adopted and exports growth has become a central component of the development strategy.