Effects of Cross-Border Engineer Exchange on Innovation: Firm-Level Evidence from Hanoi in Vietnam and Calabarzon in the Philippines

Using data from a survey to manufacturing firms, this paper attempts to detect sources of new technologies transferred to a well-established industrial district in Calabarzon, the Philippines, and a rapidly growing agglomeration in Hanoi, Vietnam. We find significant effects of exchange of engineers with customer or supplier on improvements in fundamental processes by firms in Hanoi. On the other hand, exchange of engineers significantly affects improvements in production and quality control of products newly introduced by firms in Calabarzon. The difference in the effects of exchanging engineers between the two industrial districts indicates difference in the stages of industrial development.