FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity
This study examines the transformative role of Foreign Direct Investment (FDI) in enhancing the innovation capacity of small and medium enterprises (SMEs) in Bangladesh through knowledge spillovers from foreign research and development (R&D) activities. By leveraging a mixed-methods approach, th...
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| Format: | Article |
| Language: | English |
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Editura ASE
2025-06-01
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| Series: | Management and Economics Review |
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| Online Access: | https://mer.ase.ro/files/2025-2/10-2-12.pdf |
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| author | Amitavo BAIRAGI |
| author_facet | Amitavo BAIRAGI |
| author_sort | Amitavo BAIRAGI |
| collection | DOAJ |
| description | This study examines the transformative role of Foreign Direct Investment (FDI) in enhancing the innovation capacity of small and medium enterprises (SMEs) in Bangladesh through knowledge spillovers from foreign research and development (R&D) activities. By leveraging a mixed-methods approach, the research explores mechanisms such as technology adoption, skill enhancement, and collaborative projects that facilitate knowledge transfer to local SMEs. Empirical findings underscore that high-technology sectors benefit the most from FDI-driven innovation. At the same time, resource limitations, regulatory barriers, and insufficient absorptive capacity hinder SMEs from fully leveraging these opportunities. The study also identifies critical factors, including government policy support and infrastructure development, that influence the effectiveness of FDI spillovers. Recommendations include targeted policy interventions, enhanced training programs, and fostering foreign-local firm collaborations to optimise FDI’s impact on the innovation ecosystem. These insights provide a framework for sustainable and innovation-led economic growth in Bangladesh and similar emerging markets. |
| format | Article |
| id | doaj-art-e5d5c6e633fd4f529b8d80694f8aa33d |
| institution | Kabale University |
| issn | 2501-885X |
| language | English |
| publishDate | 2025-06-01 |
| publisher | Editura ASE |
| record_format | Article |
| series | Management and Economics Review |
| spelling | doaj-art-e5d5c6e633fd4f529b8d80694f8aa33d2025-08-20T03:25:07ZengEditura ASEManagement and Economics Review2501-885X2025-06-0110245747010.24818/mer/2025.02-12FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation CapacityAmitavo BAIRAGI0Academy of East London, United KingdomThis study examines the transformative role of Foreign Direct Investment (FDI) in enhancing the innovation capacity of small and medium enterprises (SMEs) in Bangladesh through knowledge spillovers from foreign research and development (R&D) activities. By leveraging a mixed-methods approach, the research explores mechanisms such as technology adoption, skill enhancement, and collaborative projects that facilitate knowledge transfer to local SMEs. Empirical findings underscore that high-technology sectors benefit the most from FDI-driven innovation. At the same time, resource limitations, regulatory barriers, and insufficient absorptive capacity hinder SMEs from fully leveraging these opportunities. The study also identifies critical factors, including government policy support and infrastructure development, that influence the effectiveness of FDI spillovers. Recommendations include targeted policy interventions, enhanced training programs, and fostering foreign-local firm collaborations to optimise FDI’s impact on the innovation ecosystem. These insights provide a framework for sustainable and innovation-led economic growth in Bangladesh and similar emerging markets.https://mer.ase.ro/files/2025-2/10-2-12.pdfforeign direct investment (fdi)innovation ecosystemsmall and medium enterprises (smes)knowledge spillovers |
| spellingShingle | Amitavo BAIRAGI FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity Management and Economics Review foreign direct investment (fdi) innovation ecosystem small and medium enterprises (smes) knowledge spillovers |
| title | FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity |
| title_full | FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity |
| title_fullStr | FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity |
| title_full_unstemmed | FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity |
| title_short | FDI and the Innovation Ecosystem in Bangladesh: Evaluating the Spillover Effects of Foreign R&D on SMEs’ Innovation Capacity |
| title_sort | fdi and the innovation ecosystem in bangladesh evaluating the spillover effects of foreign r d on smes innovation capacity |
| topic | foreign direct investment (fdi) innovation ecosystem small and medium enterprises (smes) knowledge spillovers |
| url | https://mer.ase.ro/files/2025-2/10-2-12.pdf |
| work_keys_str_mv | AT amitavobairagi fdiandtheinnovationecosysteminbangladeshevaluatingthespillovereffectsofforeignrdonsmesinnovationcapacity |