Asymmetries in Knowledge Dissemination from the Industrial Triad to Asia

This paper examines the asymmetric effect of R&D spillovers from Europe, Japan, and North America to nine Asian economies through trade, foreign direct investment (FDI), and information technology (IT). Due to the existence of tacit knowledge, the absorptive capacity of recipient countries plays an important role in knowledge transfer. Our empirical results indicate that knowledge dissemination from Japan via trade is associated with higher absorptive capacity. Meanwhile, positive spillover effects from Europe via FDI and from North America via IT occur when the Asian countries have high absorptive capacity.