FOREIGN TECHNOLOGY LICENSING AND FIRM INNOVATION IN ASEAN: THE MODERATING ROLE OF EMPLOYEE TRAINING AND R&D

The study investigates the role of foreign technology licensing and the moderating effects of employee training and research and development (R&D) on the foreign technology licensing–innovation relationship in Association of South East Asian Nations (ASEAN). This research focus is important because prior works on this research stream tend to concentrate on large economies such as China, while little has been done to examine this issue at the firm level in the ASEAN context. Moreover, no empirical studies to date have investigated the moderating effect of employee training, as a proxy for absorptive capacity, on the foreign technology licensing–firm innovation relationship. The study utilizes several novel ordinal regression models to address some popular limitations of the standard ordinal regression model. In addition, the propensity score matching (PSM) method is utilized to account for the endogeneity problem. The study is based on data from the Enterprise Surveys conducted by the World Bank in 2015–2016. The empirical results reveal that foreign technology licensing is positively associated with innovation at a higher degree of radicalness. Furthermore, both employee training and R&D positively moderate the foreign technology licensing–innovation relationship.