Ownership, technological intensities, and economic performance in South Africa

This paper examines statistical differences and determinants of labour productivity, and export, skill and technological intensities between foreign and local auto parts, electronics, food, pharmaceutical and garment firms in South Africa. Foreign firms enjoyed higher labour productivity, and export, overall technology, process and R&D intensities than local firms in pharmaceuticals, and export, process technology and R&D intensities than local firms in garments. Local firms enjoyed higher export, skills and process technology intensities, and invested more in training than foreign firms in auto parts. Local firms enjoyed higher skills-intensity levels than foreign firms in electronics. The links between productivity, and skills and technology variables were stronger in local firms than in foreign firms. Technological intensity was highly correlated with labour productivity but it did not have a statistically significant link with export intensity.

Keywords: ownership, technology, economic performance, South Africa, industrialising economies, labour productivity, exports, skills, technological capabilities, process technology, technological intensity, foreign firms, local firms, foreign investment