HOST COUNTRY COMPETITION, LABOR SKILLS, AND TECHNOLOGY-TRANSFER BY MULTIDIMENSIONALS

Host Country Competition, Labor Skills, and Technology Transfer by Mul tinationals. - This paper examines the impact of local competition and the availability of skilled labor on the technology imports of foreig n MNC affiliates in Mexican manufacturing industries. The authors find that proxies for local competition and labor skills are positively re lated to the recorded technology imports of foreign owned affiliates. The effects of competition appear to be particularly strong in interme diate and consumer goods industries, while the availability of skilled labor seems to be particularly important in durable and capital goods industries. Thus, government policies aiming to create a competitive climate and improve labor quality may also promote inflows of modern t echnology.