The determinants of high-technology export performance: An empirical investigation in BRICT

Abstract

In order to investigate the determinants of high-tech exports from BRIC and Turkey during the period 2006-2014, we built an empirical model based on national innovative capacity framework and High Tech Indicators conceptual model. Three panel data estimation methods with fixed effects were conducted: regression with Driscoll-Kraay standard errors, linear regression with panel-corrected standard errors and robust linear regression with a large dummy-variable set. Five clusters of measures were introduced to the empirical model respectively, and determinants related to innovation were reported to have the highest explanatory powers, followed by productive capacity, financial market development, national orientation and skilled labors. 5 integrated empirical models with more than 93 per cent explanatory power were subsequently introduced. The research concluded that the skilled labor variables (i.e. doctoral graduates and science and engineering graduates), human capital (i.e. researchers in R&D activities) and government R&D expenditures are all highly significant and positive in all the models, and some of them even exert the highest effect on high-tech exports in some models. For example, ceteris paribus, a 10% increase in government R&D expenditures and researchers will boost the share of high-tech exports in manufactured exports by 7.23% and 1.4%, respectively. Domestic innovative capacity does play an important role in the success of high-tech exports from BRIC and Turkey.