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The relative importance of home and host innovation systems in the internationalisation of MNE R&D: a patent citation analysis

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Author Info

  • Criscuolo, P.

    (MERIT, University of Maastricht and SPRU, University of Sussex)

  • Narula, R.

    (Copenhagen Business School, TIK, University of Oslo, MERIT)

  • Verspagen, B.

    (ECIS, Eindhoven University of Technology)

Abstract

This paper examines the phenomenon of home base augmenting (HBA) R&D and home base exploiting (HBE) R&D. It has three novelties. First, we argue that any given R&D facility’s capacity to exploit and/or augment technological competences is a function not just of its own resources, but the efficiency with which it can utilise complementary resources associated with the relevant local innovation system. Just as HBA activities require proximity to the economic units (and thus the innovation system) from which they seek to learn, HBE activities draw from the parent’s technological resources as well as from the other assets of home location’s innovation system. Furthermore, we argue that most firms tend to undertake both HBE and HBA activities simultaneously. Second, we use patent citation data from the European Patent Office to quantify the relative HBA vs. HBE character of foreign-located R&D. Third, we do so for European MNEs located in the US, as well as US MNEs located in Europe. Our results indicate that both EU (US) affiliates in the US (EU) rely extensively on home region knowledge sources, although they appear to exploit the host country knowledge base as well. The HBA component of US R&D in Europe in chemicals, electronics and petroleum refining is stronger than their European counterparts, as is the case for European R&D activities in the US in engineering.

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Paper provided by Eindhoven Center for Innovation Studies (ECIS) in its series Eindhoven Center for Innovation Studies (ECIS) working paper series with number 02.20.

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Date of creation: 2002
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Handle: RePEc:dgr:tuecis:0220

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Web page: http://ecis.ieis.tue.nl/

Related research

Keywords: host innovation systems; internationalisation; MNE; R&D;

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References

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  1. Verspagen, B. & Schoenmakers, W., 2000. "The spatial dimension of knowledge spillovers in Europe: evidence from firm patenting data," Eindhoven Center for Innovation Studies (ECIS) working paper series 00.07, Eindhoven Center for Innovation Studies (ECIS).
  2. Dov Monderer & Moshe Tennenholtz, 1997. "Distributed Games," Game Theory and Information 9707001, EconWPA, revised 13 Aug 1997.
  3. Jaffe, Adam B & Trajtenberg, Manuel & Henderson, Rebecca, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 577-98, August.
  4. Maurseth, Per Botolf & Verspagen, Bart, 2002. " Knowledge Spillovers in Europe: A Patent Citations Analysis," Scandinavian Journal of Economics, Wiley Blackwell, vol. 104(4), pages 531-45, December.
  5. Jaffe, A.B. & Trajtenberg, M., 1998. "International Knowledge Flows: Evidence from Patent Citation," Papers 11-98, Tel Aviv.
  6. Narula, Rajneesh, 2002. "Innovation systems and 'inertia' in R&D location: Norwegian firms and the role of systemic lock-in," Research Policy, Elsevier, vol. 31(5), pages 795-816, July.
  7. Adam B. Jaffe & Michael S. Fogarty & Bruce A. Banks, 1997. "Evidence from Patents and Patent Citations on the Impact of NASA and Other Federal Labs on Commercial Innovation," NBER Working Papers 6044, National Bureau of Economic Research, Inc.
  8. Lall, Sanjaya, 1979. "The International Allocation of Research Activity by US Multinationals," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 41(4), pages 313-31, November.
  9. Zanfei, Antonello, 2000. "Transnational Firms and the Changing Organisation of Innovative Activities," Cambridge Journal of Economics, Oxford University Press, vol. 24(5), pages 515-42, September.
  10. Adam B. Jaffe & Manuel Trajtenberg, 1996. "Flows of Knowledge from Universities and Federal Labs: Modeling the Flowof Patent Citations Over Time and Across Institutional and Geographic Boundari," NBER Working Papers 5712, National Bureau of Economic Research, Inc.
  11. Fredrik Sjöholm, 1996. "International transfer of knowledge: The role of international trade and geographic proximity," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 132(1), pages 97-115, March.
  12. Patel, Pari & Vega, Modesto, 1999. "Patterns of internationalisation of corporate technology: location vs. home country advantages1," Research Policy, Elsevier, vol. 28(2-3), pages 145-155, March.
  13. Florida, Richard, 1997. "The globalization of R&D: Results of a survey of foreign-affiliated R&D laboratories in the USA," Research Policy, Elsevier, vol. 26(1), pages 85-103, March.
  14. Kuemmerle, Walter, 1999. "Foreign direct investment in industrial research in the pharmaceutical and electronics industries--results from a survey of multinational firms," Research Policy, Elsevier, vol. 28(2-3), pages 179-193, March.
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Citations

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Cited by:
  1. Jutta Günther & Björn Jindra & Johannes Stephan, 2008. "Foreign Subsidiaries in the East German Innovation System – Evidence from Manufacturing Industries," IWH Discussion Papers 4, Halle Institute for Economic Research.
  2. Christoph Hornych & Matthias Brachert, 2010. "Determinanten der Vernetzung von Unternehmen der deutschen Photovoltaik-Industrie," IWH Discussion Papers 20, Halle Institute for Economic Research.
  3. Rajneesh Narula & Antonello Zanfei, 2003. "Globalisation of Innovation The Role of Multinational Enterprises," DRUID Working Papers 03-15, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
  4. Jonathan Jones & Colin Wren, 2008. "Re-Investment and the Survival of Foreign-Owned Plants," SERC Discussion Papers 0003, Spatial Economics Research Centre, LSE.
  5. Álvarez, Isabel & Marín, Raquel, 2010. "Entry modes and national systems of innovation," Journal of International Management, Elsevier, vol. 16(4), pages 340-353, December.
  6. Paola Criscuolo, 2003. "Reverse Technology Transfer: A Patent Citation Analysis of the European Chemical and Pharmaceutical Sectors," SPRU Working Paper Series 107, SPRU - Science and Technology Policy Research, University of Sussex.
  7. Perri, Alessandra & Andersson, Ulf, 2014. "Knowledge outflows from foreign subsidiaries and the tension between knowledge creation and knowledge protection: Evidence from the semiconductor industry," International Business Review, Elsevier, vol. 23(1), pages 63-75.
  8. Börje Johansson & Hans Lööf & Amy Rade Olsson, 2005. "Firm location, Corporate Structure, R&D Investment, Innovation and Productivity," ERSA conference papers ersa05p108, European Regional Science Association.
  9. Andrea Gauselmann, 2013. "R&D Co-operation in European Post-transition Economies," IWH Discussion Papers 4, Halle Institute for Economic Research.
  10. Wren, Colin & Jones, Jonathan, 2009. "Re-investment and the survival of foreign-owned plants," Regional Science and Urban Economics, Elsevier, vol. 39(2), pages 214-223, March.

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