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Multinational firms and the internationalization of green R&D: A review of the evidence and policy implications

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  • Joëlle Noailly
  • David Ryfisch

Abstract

This paper presents novel empirical evidence on the internationalization of green R&D by multinational firms (MNCs), as measured by patents data. Using data on inventors’ addresses for the set of 1,200 MNCs firms patenting in green technologies over the 2004-2009 period, we find that about 17% of green patents result from MNCs R&D investments conducted outside their home countries. MNCs tend to locate their foreign green R&D activities in other OECD markets and in China, in particular in lightings and solar technologies. The empirical analysis reveals that the probability of conducting green R&D abroad increases with the host country’s stringency of environmental regulation, market size and (green) R&D intensity. Also, relatively lower wages for scientists and engineers, and stronger protection for intellectual property rights in the host country increase the likelihood for MNCs to offshore green R&D. The paper concludes by discussing the policy implications of this changing global innovation landscape.

Suggested Citation

  • Joëlle Noailly & David Ryfisch, 2014. "Multinational firms and the internationalization of green R&D: A review of the evidence and policy implications," CIES Research Paper series 33-2014, Centre for International Environmental Studies, The Graduate Institute.
    • Handle: RePEc:gii:ciesrp:cies_rp_33
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    More about this item

    Keywords

    Energy; R&D; Multinationals; Globalization.;
    All these keywords.

    JEL classification:

    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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