Technology flows, outsourcing and productivity: an analysis of UK trade and FDI

Nigel L. Driffield, Michael Henry, James H. Love

Research output: Unpublished contribution to conferenceUnpublished Conference Paperpeer-review


The literature on technology spillovers from trade and FDI is ambiguous in its findings. This may in part be because of the assumption in much of the work that trade and FDI flows are homogeneous in their determinants and thus in their effects. We develop a taxonomy of trade and FDI determinants based on R&D intensity and unit labour cost differentials, and test for the presence of spillovers from inward investment and imports on an extensive sample of UK manufacturing plants. We find that both trade and FDI have measurable spillover effects, but the sign and extent of these effects varies depending on the technological and factor cost differentials between the recipient and host economies. There is therefore an identifiable link between the determinants and effects of trade and FDI which the previous literature has not explored.
Original languageEnglish
Publication statusPublished - 2006
Event9th international EUNIP conference - Limerick, Ireland
Duration: 20 Jun 200622 Jun 2006


Conference9th international EUNIP conference
OtherTheoretical and applied papers are invited in all areas of industrial policy, including the following:
- Drivers of industrial development: large versus small firms
- Spatial dimensions of industrial development
- Governance and the determinants of local economic development
- Policies to encourage industrial development (including: deregulation; EU harmonisation and regulation; impact of the 5th Enlargement)
- Technology and innovation policy
- The Evaluation Challenge: Lessons from regional and industrial development policies
- Comparative analysis of industrial development: EU countries versus other regions in the world
- Globalisation, transnational corporations and FDI
- Knowledge intensive services and the learning economy [


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