PUBLICATIONS & REPORTS

Contents Introduction

This paper examines whether technology levels were higher in foreign-owned plants than in locally-owned plants and whether technology levels in foreign-owned plants were related with foreign ownership shares in Indonesian manufacturing in 1995. The results first indicate that foreign-owned plants have higher technology levels than locally-owned plants. Second, after accounting for age of each plant, results also indicate that wholly-foreign plants tended to have higher technology levels than other foreign-owned plants and that relatively new foreign-owned plants tend to have relatively low technology levels. However, the relationship between foreign ownership shares and technology levels differs among industries, and in some industries majority-foreign plants have relatively high technology levels.