Technological intensities in East and Southeast Asian electronics firms: Does network strength matter?

This paper examines the importance of network strength (NS) on the technological intensities (TI) of electronics firms. TI was disentangled into the categories of human resource (HR), process technology (PT) and R&D (RD) intensities, and the differences between foreign and local firms. The results show that firms in Korea and Taiwan endowed with superior NS enjoy significantly higher skill intensity, TI and RD than firms in Malaysia and Thailand, which have inferior NS. There were no obvious differences in HR practices between foreign and local firms in the four countries. Local firms enjoyed higher TI and RD than foreign firms in Taiwan. There was no statistical difference involving all the technological categories between foreign and local firms in Korea. Foreign firms in Malaysia enjoyed statistically superior TI compared with local firms. Local firms in Thailand showed higher TI and PT than foreign firms. TI and RD of firms are strongly correlated with NS, which showed a stronger impact on TI and RD among local rather than foreign firms. The superior NS of Korea and Taiwan has helped firms participate in higher technological activities and pay higher wages than firms in Malaysia and Thailand.