Ownership and Technological Capabilities: Evidence from Automotive Firms in Brazil, India and South Africa

This paper examines the strength of embedding systemic and institutional support,firm-level technological capabilities and the relationship between the two in Brazil, India and South Africa. Despite Brazil and South Africa enjoying stronger exposure to external markets, firms in these countries enjoyed slightly lower technological capabilities than those in India. Stronger human capital endowments and network cohesion have helped firms in India to offset a lack of integration in external markets to drive higher technological capabilities compared to firms in Brazil and South Africa. The systemic pillars are positively correlated with firm-level technological capabilities. Foreign ownership was positively correlated with human resource practices and R&D, demonstrating the potential for strong technological spillovers from foreign to local firms. Export-intensity was positively correlated with R&D,demonstrating that the latter is critical for firms to compete in foreign markets.