Correa, Paulo G.Fernandes, Ana M.Uregian, Chris J.2012-05-312012-05-312008-09https://hdl.handle.net/10986/6773The international diffusion of technology presents an opportunity for developing economies distant from the world technological frontier to reduce their income gap relative to advanced economies. It is therefore crucial to understand why, when faced with similar technological alternatives different firms in different countries choose to adopt different vintages of capital. This paper examines technology adoption across firms in Eastern Europe and Central Asia. The findings show that access to complementary inputs - managerial capacity, skilled labor, finance, and good infrastructure - and to international knowledge - through foreign direct investment or exports - is an important correlate of technology adoption. The link between market incentives and technology adoption is more nuanced. Although consumer pressure results in technology adoption, competitor pressure does not, suggesting that only firms with rents are able to adopt technology given substantial resource constraints. Privatized firms exhibit better technology adoption outcomes but only when a clear private owner with a profit incentive is present. Better governance is associated with technology adoption only in the countries that joined the European Union in 2004. Future increases in technology adoption by firms in the region will require complementary reforms of the investment climate.CC BY 3.0 IGOACCESS TO CAPITALACCESS TO CREDITACCESS TO TECHNOLOGYACCOUNTINGADVANCED TECHNOLOGYAVAILABILITY OF DATABANK LOANBEST PRACTICEBUSINESS ACTIVITIESBUSINESS ENTERPRISEBUSINESS ENVIRONMENTBUSINESS OPERATIONSBUYERSCALCULATIONCAPABILITIESCAPITAL GOODSCENTRAL ASIANCERTIFICATESCODESCOLLATERALCOMMUNICATION TECHNOLOGYCOMMUNICATIONS NETWORKCOMMUNICATIONS TECHNOLOGYCOMPETITIVE ENVIRONMENTCOMPETITIVENESSCOMPETITORCOMPETITORSCOMPUTER USECOMPUTERSCONSUMERCONSUMERSCONTRIBUTIONSCORPORATE CONTROLCREDITORCURRENT PRICESCUSTOMSDEMOCRACYDEPRECIATIONDIGITALDIGITAL DIVIDEE-MAILECONOMIC ANALYSISECONOMIC DEVELOPMENTELECTRICITYENGINEERSENTREPRENEURSENTREPRENEURSHIPEQUIPMENTEXPANSIONEXPORT MARKETSFINANCIAL IMPACTFINANCIAL INTERMEDIATIONFINANCIAL MARKETSFINANCIAL RESOURCESFIRM SIZEFIRMSFOREIGN DIRECT INVESTMENTFOREIGN INVESTMENTFOREIGN MARKETSGLOBAL MARKETSGLOBAL SUPPLY CHAINSGOVERNMENT REGULATIONSHUMAN CAPITALICTIDSINCOMEINCOME LEVELSINCOMESINDEXESINDUSTRY STANDARDSINFLATIONINFORMATION TECHNOLOGYINNOVATIONINSPECTIONSINSTITUTIONINTELLECTUAL PROPERTYINTELLECTUAL PROPERTY RIGHTSINTERNATIONAL STANDARDSINTERNATIONAL TRADEINVESTMENT CLIMATEINVESTMENT CLIMATE ASSESSMENTJOINT VENTUREJOINT VENTURESKNOW-HOWLABOR FORCELABOR MARKETLARGE FIRMSLEARNINGLEGAL SYSTEMLEVEL OF EDUCATIONLICENSESLITERACYLIVING STANDARDSLOANMANAGEMENT SYSTEMSMANUFACTURINGMANUFACTURING INDUSTRIESMARKET COMPETITIONMARKET ECONOMIESMARKET ECONOMYMARKET INCENTIVEMARKET INCENTIVESMARKET SHAREMARKET SHARESMISSING VALUESMULTINATIONALMULTINATIONAL CORPORATIONSNATURAL RESOURCESNETWORKSNEW TECHNOLOGIESNEW TECHNOLOGYOUTSOURCINGPERMANENT WORKERSPHYSICAL INFRASTRUCTUREPRIVATE SECTORPROBABILITYPROCESS INFORMATIONPRODUCTION PROCESSPRODUCTION PROCESSESPRODUCTIVITYPRODUCTIVITY LOSSESPROSPERITYQUALITY MANAGEMENTR&DREAL ESTATEREGULATORY ENVIRONMENTRENTSRESULTRESULTSRETAIL TRADESALARIESSALESSCIENTISTSSENIORSHAREHOLDERSHAREHOLDERSSKILLED WORKERSSMALLER FIRMSSOFTWARE DEVELOPMENTSOFTWARE SERVICESOFTWARE SERVICE COMPANIESSOURCE OF INFORMATIONSTOCKSSUPPLIERSSYSTEM REQUIREMENTSTECHNICAL STANDARDSTECHNOLOGICAL CHANGETECHNOLOGICAL INNOVATIONTECHNOLOGICAL INNOVATIONSTECHNOLOGY DIFFUSIONTECHNOLOGY SPILLOVERSTECHNOLOGY TRANSFERTELECOMMUNICATIONSTELECOMMUNICATIONS INFRASTRUCTURETELEPHONETELEPHONE LINESTELEPHONE SERVICETRANSMISSIONUSERSUSESVALUE CHAINWAGESWEBWorld Bank10.1596/1813-9450-4707