Journal of Economic Literature
ISSN 0022-0515 (Print) | ISSN 2328-8175 (Online)
Firm-Level Upgrading in Developing Countries
Journal of Economic Literature
vol. 61,
no. 4, December 2023
(pp. 1410–64)
Abstract
In principle, firms in developing countries benefit from the fact that advanced technologies and products have already been developed in industrialized countries and can simply be adopted, a process often referred to as industrial upgrading. But for many firms this advantage remains elusive. What is getting in the way? This paper reviews recent firm-level empirical research on the determinants of upgrading in developing countries. The first part focuses on how to define and measure various dimensions of upgrading—learning, quality upgrading, technology adoption, and product innovation. The second part takes stock of recent evidence on the drivers of upgrading, classifying them as output-side drivers, input-side drivers, or drivers of know-how. I conclude with some thoughts about promising directions for research in the area.Citation
Verhoogen, Eric. 2023. "Firm-Level Upgrading in Developing Countries." Journal of Economic Literature, 61 (4): 1410–64. DOI: 10.1257/jel.20221633Additional Materials
JEL Classification
- D21 Firm Behavior: Theory
- D24 Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- F14 Empirical Studies of Trade
- L26 Entrepreneurship
- O14 Industrialization; Manufacturing and Service Industries; Choice of Technology
- O31 Innovation and Invention: Processes and Incentives