TECHNOLOGY TRANSFER TO CHINA BY HONG KONG'S CROSS‐BORDER GARMENT FIRMS

Abstract

Hong Kong manufacturers have historically been one of the main sources of foreign direct investment to China, but their contribution to the transfer of technology to the mainland has been questioned due to the generally labor‐ rather than capital‐intensive, low‐value‐adding activities they perform there. Using data from eighty‐four Hong Kong‐based garment manufacturers that have invested directly in mainland China, this paper examines the role of Hong Kong FDI in the transfer of technology to China. Analyses show that Hong Kong garment firms are in fact human‐capital‐intensive and are endowed with valuable managerial technology and, moreover, act as effective channels for the transfer of such technology to mainland China.

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