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APPENDIX

(51) γ sh1γ

sh1 0

  • +

    γ sh1γ

sh1 1

l o g 1 * 1 + s h Y γ γ

sh1 2

l o g 1 * 1 + s h T γ γ

sh1 3

log STR1 + γ sh1γ

sh1 4

l o g 1 * 1 s h I C T γ

log S

* h1

µSh1

=0

(52)γ sh1γ

sh1

µY1 + γ sh1γ

sh1

1

2

µ p1 + γ sh1γ

sh1 4

ρ ICT 1

γ 1µSh1

=0

Imported Services

(51’) γ sm1γ

sm1 0

  • +

    γ sm1γ

sm1 1

l o g 1 * 1 + s m Y γ γ

sm1 2

l o g 1 * 1 + s m T γ γ

sm1 3

l o g 1 1 + s m S T R γ γ

sm1 4

l o g 1 * 1 s m I C T γ

l o g 1 * m S

µSm1

=0

(52’)γ sm1γ

sm1

µY1 + γ sm1γ

sm1

µ p1 + γ sm1γ

sm1

1

2

4

ρ ICT 1

γ 1µSm1

=0

Patents

From country 1

(53)

0 1 1 β 11 β

1 1 1 + β 11 β

2 1 1 1 1 + a d i s t β 11 β

log HK

5 1 1 + β 11 β

log HKR

* 1

β 11 log Pat

* 11

µ p1

* 1

3 1 1 + h =0 11 β β

log S

* h1

3 1 1 + m 11 β β

log S

* h1

4 1 1 + β 11 β

l o g * 1 Y

(54) 1 1 1 2 1 1 1 1 1 1 1 1 1 + H K b d i s t ρ β β β β

1 1 3 1 1 + m β β

µ Sh1

1 1 3 1 1 + m β β

µ Sm1

1 1 1 4 1 1 1 1 1 4 1 1 + + + H K R y ρ β β µ β β

β11µ p1 = 0

From country 2

(55)

l o g l o g l o g 21 l 21 o g 1 * 2 1 5 * 2 1 1 4 2 1 2 1 3 2 1 * 2 2 2 1 2 1 2 1 1 2 1 0 21 2 log HKR 21 1 * 1 β 21 + + + + + p h P a t Y S H K a d i s t µ β β β β β β β β β β β β

* h1

3 2 1 + m 21 β β

=0

log S

* m1

2 2 1 (56) 2 2 1 2 1 2 1 1 2 1 + H K b d i s t ρ β β β β

1 2 1 3 2 1 + S h h µ β β

2 1 3 2 1 + m β β

µ Sm1

2 1 4 2 1 + β β

µ y1

2 1 5 2 1 + β β

ρ HKR1

β 21µ p1 = 0

From country 1

(57)

l o g 5 3 1 * 1 4 31 3 31 1 3 1 3 1 1 3 1 0 3 1 + + + Y a d i s t β β β β β β β 31 β +

β l o g log HKR 31 * * 1 3 2 3 1 H K β β 31

+ β l o g * 3 1 3 3 1 h P a t β 31

log S

µ p1

* h1 3 3 1 + m =0 31 β β

log S

* m1

3 3 1 (58) 2 3 1 3 1 3 1 1 3 1 + H K b d i s t ρ β β β β

1 3 1 3 3 1 + S h h µ β β

3 1 3 3 1 + m β β

µ Sm1

1 3 1 5 3 1 1 3 1 4 3 1 + + H K R y ρ β β µ β β

β11µ p1 = 0

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