Working Paper Series, Department of International Economics and Management, Copenhagen Business School
Murali Patibandla and Bent Petersen
Role of Transnational Corporations in the Evolution of a high-tech Industry: The Case of India’s Software Industry
Abstract: India’s software industry presents the case of an
internationally competitive high-tech industry from a developing economy.
This paper takes the evolution of the industry in terms of human capital
accumulation. The initial stock of human capital in India led to entry of
TNCs, which triggers a cumulative process of further human capital
accumulation through the market structure dynamics and spillovers. This
paper develops a simple theory and tests the propositions empirically. The
empirical analysis is based on both qualitative information collected
through field interviews and econometric analysis of firm level panel data.
There is significant evidence to the positive contribution of TNCs for the
competitive evolution of the industry.
Keywords: India; Software industry; Developing economies; Transnational corporations; (follow links to similar papers)
50 pages, June 10, 2001
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